ATHENS – With a growing population of elderly,, exodus of the young looking for work in other countries and companies ducking paying social security taxes, Greece’s sinking pension system is facing big trouble in sustaining itself and is expected to have a deficit reaching 37.3 billion euros ($43.17 billion) in the next few years.
Those were among the findings of a study by Panteion University Professor Savas Robolis and PhD student Vassilis Betsis that showed the combination of whammies hitting the system, with fewer people paying into it and more taking out of it, said Kathimerini.
The aging population will incur a cost of about 1.3 billion euros ($1.5 billion), starting in 2017 up to 2057, or the equivalent reduction in benefits to the insured and pensioners.
The researchers found that even increasing the retirement age, part of conditions demanded by international creditors in return for three bailouts of 326 billion euros ($377.33 billion) hasn’t been enough to offset other factors and while the standard will be 65 years old by 2022, the European Commission said it should be 71 by the year 2060.
The increase in the retirement age will increase the workforce, especially of women, and the aging of the labor market but lead to a reduction in the number of young workers due to reduced fertility and because they, too, will have to work more years, cutting into productivity it was said.
the fact that people will be working longer.
The researchers point out while Greece aims for annual growth of 2 percent, the negative impact of aging will mean that growth of 4 percent will actually be necessary.