Posts Tagged ‘Mexican States’

universal pensions in Sinaloa (Mexico)

Wednesday, October 10th, 2012

The government of Sinaloa in 2011 inaugurated a scheme, known as “70 y Más Estatal”, to provide pensions to every person aged 70 years and older and living in a community larger than 30,000, who had no access to the rural 70+ scheme of the federal government. Benefits are the same as those provided by the federal programme: 500 pesos (39 US dollars) a month, paid bimonthly. The state pension scheme began in April 2011, with payments retroactive to January, and a budget for 26 thousand million pensioners. This was too small a budget to provide pensions for all eligible residents. The intent was to increase coverage gradually, to eventually achieve universality. That will no longer be necessary, thanks to expansion of the federal scheme to urban communities.

The number of beneficiaries of the state pension remains fixed at 26 thousand million. As pensioners transfer to the federal 70+ programme, new beneficiaries take their place in the state scheme. It is not clear how many pensioners will remain in the state system in the end, nor when the goal of universality will be achieved. Sinaloa’s programme began three months before that of Oaxaca, and is identical, with one important difference: Sinaloa does not provide pensioners with any benefits other than cash. At least, I could found no reference in Sinaloa media or government reports to health care, life insurance, accident insurance, free telephone calls, or anything other than the cash pension.

Federal 70+ pensioners in Sinaloa numbered 76,092 at the end of 2011 and 91,383 in June of 2012. The goal is to increase the number to  106,510 by the end of 2012. (more…)

social pensions in Quintana Roo (Mexico)

Wednesday, October 10th, 2012

The government of Quintana Roo – located in the Yucatan Peninsula and home of the famous resort of Cancun – in 2006 began to provide seniors with a social pension, known as “Abuelito Estoy Contigo”. The monthly benefit of 850 pesos (currently 66 US dollars) is targeted to those 70 years of age and older, who have no other fixed income. In 2011 there was a change of government, and the name was changed to “Becas Económicas para Adultos Mayores” even though the programme itself was not changed, nor was the benefit. Last year (October 2011) there were 3,500 registered beneficiaries. This year the number has fallen to 3,300.

As the federal 70+ programme expands its coverage, Quintana Roo’s social pension should disappear, since its rules specifically prohibit provision of a pension to anyone who receives support from any government: federal, state or municipal. Those currently receiving a MX$850 state pension have no incentive to transfer to the federal scheme, which pays only MX$500, but will probably have no choice. The federal 70+ programme had 8,459 registered pensioners in Quintana Roo at the end of 2011, and 11,741 in June of 2012. The 70+ target is 17,375 pensioners in Quintana Roo by the end of 2012.

The rules for applicants (in Spanish) and an excerpt from the recent “Report of the Government” (also in Spanish) follow. (more…)

universal pensions in Oaxaca, Chiapas and Mexico City

Tuesday, October 9th, 2012

Update: Sinaloa is added to the universal pension list.

The Governor of Oaxaca, when he launched a universal pension in 2011, claimed that his state was the first to follow the path of Mexico City in providing a cash pension to all elderly residents, regardless of their employment history, income or assets. Here is the assertion, from a government press release issued at the time, that is still available at the internet portal of the government of Oaxaca.

Por primera vez, en toda la historia del estado, habrá cobertura universal a las personas de la tercera edad, mediante el Programa Estatal de Pensión Alimentaria para Adultos Mayores de 70 años y más del Programa Bienestar, el cual beneficiará a 33 mil hombres y mujeres con apoyos económicos, de salud, seguro de vida y otros servicios. ….

Con el inicio de este importante Programa … Oaxaca se convirtió en el segundo estado, después del Distrito Federal con cobertura total en apoyo a los adultos mayores.

Government of Oaxaca, “Gabino Cué inicia entrega de tarjetas Bienestar a 33 mil Adultos Mayores“, 3 August 2011

And here is my rough translation of the text.

For the first time in the history of the state, there will be universal coverage of elderly people, thanks to a State Food Allowance for Seniors 70 years of age and older, which will benefit 33,000 men and women with economic support, health care, life insurance and other services. ….

By initiating this important program … Oaxaca became the second state, after Mexico City to have full coverage in support of the elderly.

The claim that Oaxaca in 2011 was the first state to follow the example of Mexico City is false. Chiapas in 2007 introduced a universal pension, with a cash benefit of 550 pesos a month for all residents from the age of 64. This is a remarkable achievement because Chiapas is the poorest state of the Mexican union, ranking just below Oaxaca. at the very bottom in both per capita income and the Human Development Index. Failure to mention Chiapas might be an honest error. The pensions of Chiapas have received little attention in the media, so it is possible that Governor Gabino Cué was unaware of universal pensions in Chiapas, even though the state borders his own.

The claim is also incomplete. Mexico City and Chiapas provide pensions to every resident who qualifies by age (68 in Mexico City, 64 in Chiapas). From age 70, the elderly are entitled to two pensions: one from the local government and another from the federal government. These ‘double pensions’ provide a total cash income of 1,435 pesos (US$112) a month in Mexico City and 1,050 pesos (US$82) in Chiapas. Oaxaca, in contrast, like Sinaloa, provides pensions only to those over the age of 70 who are excluded from the pension-tested federal 70+ scheme. In Oaxaca and Sinaloa, then, elderly residents receive a cash pension of 500 pesos (US$39) either from the state or from the federal government. Oaxaca and Sinaloa attains universal coverage only by combining two pension-tested schemes that operate at distinct levels of government.

It is true that the elderly of Mexico have access to universal pensions only in Mexico City, Chiapas and -now- Sinaloa and Oaxaca. But the effort of the government of Oaxaca – laudable though it is – is not comparable to that of Mexico City or Chiapas. It is, though, comparable to the effort of Sinaloa.

universal pensions in Oaxaca (Mexico)

Monday, October 8th, 2012

Oaxaca, in July of 2011, joined Mexico City and Chiapas in providing a universal pension to all residents. The benefits (500 pesos a month) are lower, however, and the age of eligibility (70 years) higher than they are in the other two states with universal pensions. A more important difference is that Oaxaca achieved universal coverage by complementing federal benefits without duplicating them. The legislation specifically states that the purpose of the scheme is to provide pensions for those who, because they live in communities with more than 30,000 inhabitants, do not qualify for federal 70+ MX$500 (US$39) pensions

In January of 2012, the federal 70+ scheme expanded, to include cities larger than 30,000 inhabitants. This would have meant the end of Oaxaca’s universal (subsidiary) pension, were it not for the fact that the 70+ benefit is now restricted to those without any other federal pension (from social security, civil service, military, or PEMEX). This means that the government of Oaxaca is providing social pensions only to those residents who have access to a federal pension, but no access to the (usually much smaller) 70+ pension. This does achieve the goal of universality, but one might question whether it is a good use of public funds to provide benefits to those with relatively high incomes in a state with a high incidence of poverty. This policy can be justified, although the government has not made the case, other than to claim that universality in itself is a worthy goal, hence the correction of an ‘error- pension-testing – in the federal scheme.

The justification I am thinking of is improved incentives. Most of the non-70+ federal pensions are contributory pensions, earned by participating in social security, and many of the earned pensions are very modest. Now, the majority of workers in Mexico are informal and do not contribute to social security. To deny a 70+ pension to those who earn a social security pension, no matter how small, is to convert social security contributions into taxes. This provides an incentive to remain outside the formal economy, outside the social security system which, incidentally, provides health care and survivor benefits as well as retirement pensions.

Oxaca’s legislation provides not only monthly cash pensions of 500 pesos (39 US dollars), but also “complementary benefits” such as life insurance (50 thousand pesos for accidental death, 7,500 pesos for natural death), accident insurance (500 pesos for each day of hospitalisation, up to 10 days), discounts on purchases in participating stores, and free telephone calls to the United States and Mexico. These benefits are provided by the state government to each resident aged 70 years or older, irrespective of the source of their ‘universal’ MX$500 pension.

Beneficiaries of Oaxaca’s social pension, which numbered 33,000 last year, have dropped to about 13,000 because of the expansion of the federal 70+ scheme to urban areas, and are expected to fall further, to 11,000. Oaxaca’s 70+ beneficiaries, in contrast, grew from 172,532 at the end of 2011 to 185,924 by mid-2012.

Detailed information, with links, follows in Spanish. (more…)

universal pensions and Mexican politics (update)

Monday, October 8th, 2012

This updates a previous post on this subject.

For the record, the supporters of Andrés Manuel López Obrador – members of the centre-left PRD, Partido de la Revolución Democrática – in Mexico’s upper chamber (the Senate) introduced legislation last month that would provide a universal pension for all Mexicans from age 65, with no test for eligibility other than residence and age. The proposed pension is the same size as that of Mexico City’s universal pension – one-half of a minimum wage – but with an age of eligibility that is three years younger. Mexico has daily minimum wages that increase annually with consumer prices, and vary slightly by region. “One-half a minimum wage” in Mexico is calculated as 15 days of minimum wages per month, equal to MX$934.95 [US$73] in zone ‘A’, which includes Mexico City, MX$908.55 in zone ‘B’ and MX$886.20 in zone ‘C’. Differences between zones are supposed to reflect differences in the cost of living.

This pension would replace the federal 70+ pension, which is pension-tested (not universal), with a benefit that has remained at MX$500 a month since the scheme was introduced in 2007, with no adjustment for price inflation.

Andrés Manuel López Obrador, known as AMLO, introduced universal pensions to Mexico’s capital city in 2001, when he was Mayor. AMLO ran for president in 2006 and would have implemented universal pensions in all of Mexico had he won, but he lost narrowly to Felipe Calderón of the centre-right PAN (Partido Acción Nacional). He ran again in 2012 and polled second out of three major candidates, with 32% of the popular vote. Enrique Peña Nieto of the traditional PRI (Partido Revolucionario Institucional) won that election with 38% of the popular vote.

The PRD is a minority in both legislative chambers, so there is little chance that the proposed legislation will ever become law. It is promising, though, that four PRI senators joined their PRD colleagues to sponsor this initiative. (more…)

universal pensions in Mexico City

Friday, October 5th, 2012

Mexican economist Miguel Angel Ferrer (born 1948) has written a very nice column on the virtues of Mexico City’s universal pension. Here is an extract. (For those who cannot read Spanish, a rough translation follows the original text. But this type of prose always reads better in the original.)

Por lo que toca a los adultos mayores, el salario social asume la forma de una asignación universal sin contraprestación ninguna y sin más requisito que haber alcanzado los sesenta y ocho años de vida y residir en la Ciudad de México, igualmente llamada Distrito Federal. Y a partir del primer día de 2012, esa asignación universal y directa es de 934 pesos y 25 centavos al mes, algo más 30 pesos diarios, y recibe el nombre oficial de “Pensión alimentaria para adultos mayores”.

Este programa, desde luego, cuenta con la aquiescencia de la inmensa mayoría de la población de la ciudad de México. Y sólo recibe críticas y demandas de cancelación por cuenta de algunos sectores sociales y personalidades del más rancio conservadurismo y nula solidaridad social e inteligencia.

Al ser un programa de carácter universal y no focalizado, la pensión alimentaria para adultos mayores es casi inmune a la corrupción y a la simulación. Y acaso lo único censurable del noble programa sea la insuficiencia o el reducido monto que recibe cada anciano inscrito en el padrón respectivo. Pero a pesar de su bajo monto, esos 30 pesos al día pueden hacer la diferencia entre comer y no comer, entre una vida austera y la más dolorosa de las miserias. ….

Probada la justicia, pertinencia y viabilidad financiera del programa, éste ha adquirido carácter institucional. Y ya es patrimonio, difícilmente reversible, de los habitantes de la ciudad capital de los mexicanos.

Miguel Angel Ferrer, “Ancianos y pensión alimentaria“, El Sol de México, 21 de septiembre de 2012.

The social wage of seniors takes the form of a universal pension without need for a record of contributions or employment and without any requirement other than reach the age of sixty-eight years and reside in Mexico City, also called the Federal District. From the first day of the year 2012, that universal pension is 934 pesos and 25 cents a month, somewhat more than 30 pesos (USS$2.35) daily, and it goes by the official name “Food allowance for seniors”.

This programme of course is supported by the vast majority of the population of Mexico City. It receives criticism and demands for cancellation only from certain social sectors, from personalities of the most rancid conservatism, who show zero social solidarity and intelligence.

Being a programme that is universal and not targeted, the food allowance for seniors is nearly immune to corruption and graft. Perhaps the only defect of the noble programme is the small amount received by each senior included in the list of beneficiaries. But 30 pesos a day can make the difference between eating and not eating, between a life of austerity and the most painful miseries. ….

Having proven its justice, relevance and financial viability, the programme has acquired an institutional character. It has come to form part of the heritage, difficult to reverse, of residents of Mexico’s capital city.

social pensions in Nuevo Leon (Mexico)

Friday, October 5th, 2012

The northern state of Nuevo Leon (capital: Monterrey) has a relatively generous social pension. The programme, known as “Apoyo Directo al Adulto Mayor” began in 2004 with means-tested pensions of MX$500 for 25,000 residents aged 70 years and older. By 2008 the number of beneficiaries reached 50,000, and in 2010 the size of the pension was increased to MX$700 (approximately US$55 at today’s exchange rate). Beneficiaries as of September 2012 number 57,618.

A unique feature of the scheme is its transparent use of geographic targeting in an attempt to reach the most destitute of the elderly population. The rules for applicants are simple. (Below is my translation of the rules, followed by the Spanish original.)

– Be 70 years of age or older, living in poverty.
– Be a native of Nuevo Leon or have at least five years residence in the state.
– Reside in one of the areas with the highest incidence of poverty in the state.
– Not be receiving a pension, nor support from local or foreign governments.

Apoyo directo al adulto Mayor
¿Qué se requiere para ser beneficiario?

    – Tener 70 años de edad o más, vivir en situación de pobreza.
    – Ser originario de Nuevo León o tener al menos cinco años viviendo en la entidad.
    – Vivir dentro de las áreas de mayor carencia en el estado. [geographic targeting!!!]
    – No contar con pensión ni apoyo de gobiernos locales o extranjeros.

Government of Nuevo Leon, Internet Portal, accessed 5 October 2012.

According to the government’s portal, its social pension covers the entire state, including more than one thousand rural communities. (“Tiene cobertura en los 51 municipios del estado y en alrededor de 1,070 comunidades rurales.”) This implies that in rural communities at least some – possibly a majority – of the 32,000 beneficiaries of the universal 70+ pension have been receiving an additional means-tested benefit from the state of 700 pesos, for a total of 1,200 pesos (US$94) each month, despite a rule against receiving support from “local or foreign governments”. Well, one might argue that the federal government is neither local nor foreign, so the 70+ scheme does not count! (more…)

social pensions in Jalisco (Mexico)

Thursday, October 4th, 2012

Jalisco’s means-tested social pension, which is restricted to residents 70 years of age and older, first became available in May of 2007, in urban communities not covered by the federal 70+ programme. The pension, known as “Vive Grande”, provides a cash benefit of 500 pesos (US$39) a month, the same as the federal 70+ pension, but payments are quarterly rather than bimonthly.

At the beginning of 2012, there were 31,154 recipients of a state social pension. The federal 70+ programme is much larger, with 117,000 rural beneficiaries. An additional 100,866 beneficiaries from urban communities are expected to enrol in 70+ during the year 2012. This, effectively, marks the end of state government involvement in social pensions in Jalisco. The government of Jalisco could have followed the example of Chiapas and Mexico City, providing pensions to those younger than 70, and additional cash payments at least for the poorest pensioners, but the state chose not to “duplicate” federal efforts in this area.

Earlier this year, TdJ reported that the Jalisco legislature had passed a law to provide all elderly residents from the age of 70 a minimum universal pension equal to 15 days of one-half the minimum wage (then about 840 pesos). This story, though widely disseminated in local media, was not true. The law – first tabled in 2006 – was passed in committee, but was never approved by the full legislature.  (more…)

social pensions in Durango (Mexico)

Wednesday, October 3rd, 2012

In March of 2009, the government of Durango launched a means-tested social pension with the name “Durango Solidario”. In August 2010 the name was changed to “Crecemos con Futuro”, but the age of eligibility and amount of benefit remained the same: 70 years and 500 pesos (US$40), respectively. Perhaps not by coincidence, this is identical to the federal 70+ scheme, except that it is subject to a strict test of means. At the end of last year (2011) there were 6,332 registered beneficiaries of “Crecemos con Futuro”. Presumably all none of these beneficiaries resided in Durango, Gómez Palacio or Lerdo, the three urban municipalities excluded from the federal 70+ rural pension scheme.

In January of 2012 Sedesol, the federal agency, began to extend 70+ to the urban municipalities of Durango. The target is registration of 15,500 new persons which, added to the more than 39 thousand existing beneficiaries, will mean more than 55,000 beneficiaries of 70+ in Durango by the end of the year. As of 30 June, Sedesol had registered 9,082 new beneficiaries – more than half the targeted number.

As for Durango’s state programme, I could find no mention of it after 2011. I can only assume that all “Crecemos con Futuro” pensioners have transferred to the federal programme and are receiving the same benefits as before.  (more…)

social pensions in Guerrero (Mexico)

Wednesday, October 3rd, 2012

The State of Guerrero provides a means-tested social pension of 400 pesos (US$30)  a month to residents 65 years of age and older. The programme, known as “Pensión Guerrero” began in the five largest cities in 2003, and expanded to other municipalities in subsequent years, reaching the entire state from the year 2009. Beneficiaries numbered 52,000 in 2011, and fell to 49,000 in August of 2012. The government specifically prohibits “double-dipping”, i.e. receiving both state and federal benefits, so is transferring beneficiaries to the federal 70+ programme, leaving only those aged 65 to 69 years in the state programme. Since federal benefits are larger than state benefits, it is easy to encourage pensioners to make the switch.

The 2012 budget for Pensión Guerrero is 240 million pesos, sufficient for 50,000 pensions. The intent apparently is to continue to finance 50,000 social pensions, which would make way for more pensioners aged 65 to 69 years, but future plans are not at all clear. For the moment, the priority is transferring older pensioners from Pensión Guerrero to the federal 70+ scheme. (more…)