Pondering pensions; Chile.(Chile's "model" pension system needs a facelift)

Economist (US), The, November, 2005

Ageing model requires facelift

CHILE'S private pensions system, created by Augusto Pinochet's dictatorship almost 25 years ago, has been a model for pensions reform in many other countries. While academics have long noted various flaws--not least the high profits raked off by the six pension-fund administrators (AFPs)--it nevertheless came as a shock when a recent study suggested that over half of the Chileans affiliated to the system might not get a decent retirement income.

Declaring the pensions system "in crisis", Michelle Bachelet, the centre-left government candidate, and likely winner, in the presidential election on December 11th, promises to send a reform bill to Congress by the end of next year.

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