Tackling Poverty in Old Age: A Universal Pension for Sri Lanka

Abstract:     
This study provides estimates of the fiscal cost of a universal age pension in Sri Lanka. It challenges opponents of universal pensions who assert that such pensions are unaffordable, despite the fact that countries as diverse as New Zealand, Mauritius, Nepal, Namibia, Bolivia and Kosovo have successfully put them in place. The authors demonstrate that a universal pension in Sri Lanka is affordable, and urge policymakers designing basic pension schemes to avoid means-tests and 'rule-based targeting' for reasons of efficiency, equity and political appeal.

Number of Pages in PDF File: 52

Keywords: public pensions, social security, means test, targeting, demographic ageing

JEL Classification: H55

working papers series