The issue of fees in the administration of Latin American pension system, with special reference to the Colombian system

Abstract

New models of pension schemes implemented by the end of the 20th centuryare being revised in their fundamental elements, in order to detect the mostsignificant failures of their dynamics. One element that has been consideredfor reform is the structure of fees to be paid by workers to the Pension FundAdministrators. The assessment of the more efficient commission in relationto the objectives of the pension system, mainly the generation of sufficientand adequate pension amount and the expansion of coverage, is made fromthe analysis of the most important reforms in this subject which have happenedin Latin America. Among all the commission categories, it was foundthat the one based on the worker's wage has advantages over other methods,in terms of containing costs of the Pension Fund Administrators and providingsocial security system coverage