Executive summary

Senior citizens

The major risk for senior citizens is that they do not have a pension when they leave the labor market and must depend on relative or charity for their survival.

Table A.3.1.8: Education Attainment a/, 2003

	Total	Extreme Poor	All Poor	Non-poor	Urban Areas	Rural (non indigenous)	Indigenous
Years 12-17
Total	6.9	5.4	6.1	7.6	7.4	6.7	4.9
Male	6.7	5.1	5.8	7.4	7.2	6.4	4.9
Female	7.1	5.7	6.3	7.8	7.7	6.9	4.9
Years 18-24
Total	10.0	6.2	7.5	11.3	11.1	8.8	5.3
Male	9.6	6.4	7.4	10.9	10.6	8.2	6.2
Female	10.5	5.9	7.7	11.7	11.5	9.4	4.3
Years 25 +
Total	8.6	3.7	5.3	9.9	10.2	6.2	3.1
Male	8.5	4.3	5.4	9.8	10.2	6.1	4.1
Female	8.7	3.2	5.2	10.0	10.2	6.3	2.1

Source: LSMS 2003

a/ Average number of years of schooling.

Lack of pension. Panama’s social security institute or Caja de Seguro Social (CSS), was established in 1941 and offers insurance to about two-thirds of the population under three programs: health (Enfermedad y Maternidad); professional risks (Riesgos Professionales); and pensions (Invalidez, Vejez y Muerte). The pension system consists of an obligatory defined-benefit pay-as-you-go scheme with partial collective capitalization funded through compulsory contributions. Although social security coverage in Panama (51 percent of the labor force) is similar to Costa Rica (49 percent) and greater than Argentina (21 percent) and Mexico (30 percent), 1.2 million Panamanians are still not covered.⁵²

In 2003, according to the Directorate of Statistics and Census, there were about 274,000 seniors of retiring age or more (57 years for women and 62 years for man), about 9 percent of the total population. That year, CSS counted 162,600 beneficiaries in those ages, of which 145,046 were pensioners and the remainder 17,554 active members or dependents (Table A.3.1.9).⁵³ Therefore, about 111,400 seniors are without pension or access to CSS benefits.

About 25 percent and 9.5 percent of the population above 62 are in poverty and extreme poverty, respectively. Applying these rates to the retiring age population (274,000) yields 68,500 poor and 26,000 extreme poor seniors, who are likely among those without pensions.

Table A.3.1.9: Population with Pensions, 2003

	Total	Extreme Poor	All Poor	Non-poor	Urban Areas	Rural (non indigenous)	Indigenous
No. Pensioners a/	145,046	1,987	10,427	132,632	118,246	25,952	848
Population 62 +	256,843	24,432	63,600	193,243	152,665	93,866	10,312
%	56.5	8.1	16.4	68.6	77.5	27.6	8.2
Average Pension b/	426	206	222	442	453	308	232

Source: No. of Pensioners (CSS; “Panama en Cifras 2000-04” Dirección de Estadística y Censo, 2005 (Cuadro 421-01) and LSMS 2003

a/ Includes the professional risk (Riesgos Professionales). b/ B/ month