خلاصة:
The rapid aging of Iran’s population and its low economic growth is a major concern for Pension Funds with the DB-PAYG defined benefit-cost plan. While many countries have undertaken parametric reforms to mitigate the impact of this process in order to maintain the financial sustainability of the Fund, others have attempted to solve this problem through systematic reforms: implementation of new Defined Contributions (DCs) and Notional Defined Contributions (NDC). This article, while studying the current system of the armed forces pension fund, introduces a new retirement system for notional personal accounts and examines the long-term financial sustainability of both the DB-PAYG and NDC systems. The Monte Carlo method is used to simulate retirement systems. Simulation results show that the proposed system can mitigate the effects of economic and demographic changes and reduce the armed forces pension fund commitments by at least one-third. Applying this system requires capital or government budget inflows or decreasing the increasing rate of pension salaries which will result in pensioners’ welfare reduction.
ملخص الجهاز:
Pathology of the Armed Forces Retirement Fund; Proposing a Notional Personal Accounts System to Ensure the Financial Sustainability of the Fund 1 Mohammad Bagher Adabi Firouzjayi 2 Behnam Karimi Submission Date: 2018/08/07 Acceptance Date: 2018/12/09 Abstract The trend of rapid population aging and slow economic growth has caused most retirement funds with the Defined Benefit-Pay As You Go (DB-PAYG3) scheme to be concerned about the balance between income and expenditure.
After simulation, the results show that the proposed system can reduce the effects resulting from economic and demographic changes and reduce the obligations of the Armed Forces Retirement Fund by at least one third; however, implementing such a system in the Armed Forces Retirement Fund requires pre-determined capital or government assistance from the public budget, or else the continuous inflation rate must decrease, which, given the current economic conditions of the country, would itself lead to a reduction in the welfare level of employees.
Pension Funds The country's public pension funds, as independent international financial institutions, provide the possibility of securing individuals' retirement periods during old age and disability through the collection of micro-savings of individuals under the title of pension insurance premiums and the investment of these resources in the form of an asset portfolio and its management; therefore, these funds, as much as they are considered social institutions, possess economic importance and influence the indicators of economic development and growth through two main paths.
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