SER discusses challenges and prospects of Curacao’s pension system during conference

“Targeted action now!”

Willemstad, June 27, 2023 – On the opening day of the conference entitled “Living longer, working longer: the sustainability of the pension system in the Dutch Caribbean,” Drs. Raul Henriquez, director/general secretary of the Social and Economic Council (SER) of Curaçao, spoke about the future challenges and sustainability of the pension system in Curaçao. The two-day conference, organized by the Algemeen Pensioenfonds Curaçao (APC) and the University of Curaçao (UOC) on Thursday, June 22 and Friday, June 23, took place in the auditorium of the UOC. The audience included pension and social security experts, actuaries, representatives of pension funds and other interested parties from the CAS countries (Curaçao, Aruba and Sint Maarten).

Henriquez emphasized the demographic challenges facing Curaçao, such as increasing aging, de-growth, and emigration surplus, resulting in increased “gray pressure”. As a result, a growing group of non-working people must be financially supported by a shrinking group of working people, which puts pressure on the sustainability of the pension system.” Henriquez said it is crucial to develop innovative and structural solutions that both protect the interests of seniors and support the economic vitality of Curaçao. He pointed to the opportunity for significant improvements within the second pillar of the pension system, the supplementary pension plans. He also indicated that the problem of non-compliance regarding premium payments for the General Old Age Insurance (AOV) seriously threatens the financial stability of the pension system.

The SER director stressed the importance of deciding on a comprehensive policy framework that addresses both the economic and institutional sustainability of AOV, and counteracts the problem of non-compliance. He spoke of the need for various interventions to ensure the financial sustainability of the pension system. In line with this, he referred to the proposed policy adjustments by the Economic Research Foundation (SEO), including raising the AOV age starting in 2030.

The ultimate goal, Henriquez stressed, is to guarantee the dignity and well-being of Curaçao’s elderly population by strengthening the pension system. He further underscored the importance of recognizing the contributions seniors have made to society, and called for respect and recognition by offering them a dignified life after retirement. In this context, Henriquez also highlighted the ethical obligation to care for the most vulnerable, promote social cohesion, and support social justice. He stressed that every individual is entitled to a basic level of economic security and the opportunity to actively participate in society, regardless of age.

In his speech, Henriquez referred to an important 2020 study by the SER on the future of AOV in Curaçao. The study highlighted the crucial role of migration and demographic changes in the financial sustainability of the AOV system. He also discussed the SER’s 2018 opinion on the initiative-drafted Basic Statutory (Mandatory) Pension, stressing the need for a thorough analysis of the objectives, financial implications, and protection of workers.

Finally, Henriquez called for targeted action to ensure a dignified life after retirement and the future of Curaçao’s AOV system. He stressed the urgency and called for concerted efforts for a sustainable and equitable pension system.

The complete speech of Mr. Henriquez is only available in Dutch.