Lecturer Says Current Government Pension is Unsustainable

The current government pension scheme that exists for public officers is unsustainable and needs urgent reform – that is the information coming out of the Second Annual Gian Ghandi Memorial Lecture that was held today by the University of Belize. Dr. Philip Castillo, a lecturer at U.B., discussed the major issues that make the government’s current pension scheme untenable.

Dr. Philip Castillo

Dr. Philip Castillo, Lecturer, U.B.

“It is non-contributory. You do not contribute to your pension. So what that means then, what that means, is that for every public officer who is hired by government that represents a potential life-long commitment for payment from government. You did not contribute to that pension. You retire at fifty-five, but in Belize, life expectancy is at seventy-four, on average, which means then that for nineteen years after you retire you get a monthly pension. And, a public servant, because of his above-average educational level, because of his above-average income level, generally knows what to do to live longer. So you’re seeing then, that pensioners are generally beating the average. So you expect that more pensioners would live longer than the average life expectancy, which is seventy four years old. In 2008, government’s pension commitments were thirty-eight million dollars. In 2020, it jumped to seventy-two point five million dollars. In 2021-2022, that’s the financial year that just concluded, it was at ninety-six point eight million dollars, and the amount budgeted for this current financial year is one hundred point nine million dollars. Last financial year, pensions jumped by thirty-four percent in one financial year. These percentage increases are clearly unsustainable.”