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Latvia Told to Raise Minimum Pensions

Latvia Told to Raise Minimum PensionsLatvia Told to Raise Minimum Pensions

The Organization for Economic Cooperation and Development, of which Latvia is a member, recommends that the country substantially raise its basic pensions to reduce old-age poverty and pension inequality, the OECD says in a report published Wednesday. “The relative old-age poverty rate is high, especially among those older than 75 years and among women. The level of the basic pension (state social security benefit in the case of old age allowance) is very low and has not risen in nominal terms for more than 10 years. “There is substantial room in Latvia to increase the level of the basic pension from the current level of 8% of average wage towards the OECD average of around 20%,” the report suggests. It also recommends lowering the minimum contribution period of 15 years required for the minimum pension and calls to ensure that each additional year of contribution results in a higher minimum pension benefit as currently only an increase of the contributory period at specific points results in greater benefits.

 

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