Social pensions have positive social and economic effects

Pensions empower older people by:

• increasing their household food security and nutritional intake
• promoting women’s empowerment and balancing gender relations
• facilitating educational access and achievement for orphans and vulnerable children in their care
• improving health outcomes, especially for older person headed households affected by HIV and AIDS
• reducing intergenerational transmission of poverty
• mitigating risks and vulnerabilities that cause chronic poverty.
  Source: Samson, M, van Niekerk, I and MacQuene, K, Designing and Implementing Social Transfer Programmes, EPRI Press, South Africa 2006.

Pensions help reduce extreme poverty and hunger

• The first target of Millennium Development Goal 1 is to halve the proportion of people living on less than a dollar a day by 2015. Social pensions can help achieve this target. In South Africa, the pension reduces the number of people living below the poverty line by 5% (2.24 million). Source: Case, A and Deaton, A 1998; Large Scale Transfers to the Elderly in South Africa, Economic Journal, vol. 108, #450, pp 1261-1330.
• 55% of recipients of Chile's PASIS social pension have moved from being extremely poor to poor and 45% have moved out of poverty altogether. 
  Source: Bertranou F, Pensiones no contributivas: Su relevancia en la reforma previsional, OIT Notas, 3 May 2006.
• Social pensions can increase the share of the poorest 5% of the population in national consumption. They increase the income of this group of the population by 100% in Brazil and by 50% in South Africa. 
  Source: Non-contributory pensions and poverty reduction: a comparative study of Brazil and South Africa, HelpAge International, September 2003.

Social pensions contribute to the human-rights agenda

• Social pensions support the rights of older people and their contribution to development.
  Source: Why social pensions are needed now, HelpAge International briefing paper, October 2006.
• Social pensions build good governance and political support for citizenship. 
  Source:  Ageways 67, Older Citizen’s Monitoring, HelpAge International, June 2006. (Report on field work in Bangladesh, Bolivia, Kenya, Jamaica, and Tanzania.)
• Social pensions help to reduce gender inequalities in income and quality of life between older women and men.  Source: Tabor, S R , Assisting the Poor with Cash:  Design and Implementation of Social Transfer Programs. Social Protection Discussion Paper Series #223, Social Protection Unit, Human Development Network, The World Bank, 2002.

Social pensions effectively target aid at minimum cost

• In Brazil, pensions reach 5.3 million poor older people at 1% of gross domestic product (GDP). A pensioner in the family reduces a household’s probability of being poor by 18%. 
• In 2002 in South Africa, pensions reached 1.9 million poor older people at 1.4% of GDP. A pensioner in the family reduces a household’s probability of being poor by 12.5%.  Source: Barrientos, A, Non-contributory pensions and poverty reduction in  Brazil and South Africa, January 2005.

Social pensions improve the life chances of orphans and vulnerable children

• In Zambia, a pilot cash-transfer scheme to older people caring for orphans has improved school attendance.  Source: Social Cash Transfer Scheme, Kalomo Zambia, Ministry of Community Dvelopment and Social Services/ GTZ Social Safety Net Project kalomo cash transfer scheme, February 2005 An Assessment Study in the Framework of the Development of a Social Protection Strategy.
• Social pensions improve access to education for female children being cared for by their grandparents. 
  Source: Kakwani, Nanak and K Subbarao, Conditional Cash Transfers in African Countries, International Poverty Centre, Working Paper #9, p12 and 26, UNDP, 2005. 
• In rural Brazil, pensions are associated with increased school enrolment, particularly of girls aged 12-14. 
  Source: Carvalho, 2000 cited in Barrientos A and de Jong, J Child poverty and cash transfers, CHIP report 4, CHIP 2000.
• In South Africa, girls living in a household with an older woman in receipt of a pension are 3-4cm taller than girls in households with older women who do not receive a pension. 
  Source: Duflo, E, 2000 cited in Palacios R and Sluchynsky O, Social Pensions Part I: their role in the overall pension system, SP Discussion Paper 0601, World Bank, 2006.
• Social pensions alleviate the impact of HIV and AIDS by providing financial resources for the care of very vulnerable children and orphans. 50-60% of orphans live with grandparents in Namibia, Botswana, South Africa, Malawi, Zimbabwe and Tanzania, as do 50% in Thailand. Source: Age and security: How social pensions can deliver effective aid to poor older people and their families, HelpAge International, 2004.

Social pensions are feasible, affordable and create economic opportunity

• The cost of delivering universal benefits is not beyond the means of resource-poor countries. Botswana, Lesotho, Nepal and Mauritius all have domestically financed universal social pensions, which cost a maximum of 2% of GDP.
  Source: Devereux S et al, Making cash count: Lessons from cash transfer schemes in east and southern Africa for supporting the most vulnerable children and households, Save the Children, HelpAge International and Institute of Development Studies, 2005.
• Research into the social pension in Lesotho shows that 18% of recipients spent part of their pension on creating cash jobs for other people. 
  Source: Lesotho Pension Impact Group, Interim report of the pensioner survey, March 2005-August 2006.
• In South Africa recent research suggests that social transfers, including pensions, facilitate access to employment and create jobs.
  Source: Why social pensions are needed now, HelpAge International briefing paper, October 2006.
• Research in northern Namibia shows that between a quarter and a half of pension income is invested in productive enterprises.
  Source: Why social pensions are needed now, HelpAge International briefing paper, October 2006.