Comparing the Long-term Benefits of Social Security System in the I. R. Iran and other Countries

Reduction of fertility rate besides continuous increase in life expectancy in the I.R. Iran and other countries decreased the efficiency of old social security systems and faced the sustainability of Social Security Funds with serious problems. During the last decade, expansive reforms have taken place to reduce the burden of social security commitments. However, despite numerous binding liabilities, reforming the rules of social security has been delayed in our country. This article takes the first step by comparing social security systems in the world considering their efficiency, characteristics, commitments and influential parameters and rules. It was clarified that low retirement age, high accrual rate and unsuitable way of measuring individual earnings in calculation of pension benefits are the main three factors which play the greatest role in expanding the social security commitments in the I.R. Iran and the region. Taxation is another policy tool which can be used to fulfill welfare objectives of retirees. Applying these tools together with social security services may decrease the burden of social security commitments.