Grandmothers and Granddaughters:

Old-Age Pensions and Intra-household

Allocation in South Africa

Review of Academic Paper

By

Anusha Purba Khan

ID: 1931782620

Section: 2

School of Business and Economics

Department of Economics

Assignment Submitted in Fulfillment of the Requirements for the ECO415 Course

3 August, 2021
 The article discusses the interrelationship of pension received by women in
households of South Africa and considers a myriad of factors in its analysis. It investigates
whether gender has any direct relationship between improving nutritional figures and health
of children in the family when cash transfers are passed to the women. At the end of the
article the author draws mixed conclusion where they believe the cash transfer scheme did
not particularly have any impact based on the recipient being woman or man; in fact it can
have other factors affecting it like while female recipients show positive improvement in
child’s health, male recipients may contribute to creation of human resource by providing
education-related and similar resources, etc. Both of these are unquantifiable in nature, and
additionally, the author also finds this scheme to have restrictions on its effectiveness outside
the specific context of post-apartheid South African women, otherwise it opposes gender
equality. Therefore, the author recognizes limitations and suggests more extensive research
be carried out before drawing irrefutable conclusions.

Pension systems and reforms have traditionally had different effects on men and
women because of their diverse career histories and socioeconomic characteristics. Several
publications have been published that focus at pension system design from a gender
perspective, examining issues such as system features and analyzing projected effects on
incentives, pension benefits, and income distribution for both men and women.
1. Norway has researched the popular opinions of its citizens and tried to find the root
of the persistent gender gap in pensions. It has also delved into the introduction of child
credits to compensate mothers for losing accrued pension rights for caring of their small
children. It questioned the assumption that child credits are indisputable pro-women, and
used data to investigate public opinion on whether they discourage mothers from working
and favor couples who have a traditional division of paid and unpaid work, as well as
whether the pension system should compensate low-earning parents (mothers) of pre-school
children. They discovered that, while both genders have good sentiments toward child
credits, women are on average more disposed to support them than men, but there are
significant internal divides. While less educated women in traditional households are the
most supportive, highly educated women in gender-equal families are just as suspicious as
their male counterparts about child credits.

2. A paper by James, Edwards and Wong examining the new and old systems in three
Latin American countries – Chile, Argentina and Mexico emphasize how pension systems
would affect genders differently by surveying household for data to determine the nature of
relation between the wage and employment histories of representative men and women, and
analyze the consequences of the pension system reforms. Using data from the household
survey, they recreated example men and women's salary and job histories, the pensions they
are predicted to receive under the new and old laws, and the respective gains or losses of the
two genders as a result of the reform. They discovered that in the new arrangements, women
do indeed accrue private pensions that are just 30–40 percent of what men do. However, the

[1]
new public pillars' severe targeting of low-income earners, many of whom are women, and
constraints on payouts from the private pillars, including joint annuity requirements,
minimize this effect. As a result, the pension reform benefits low-income married women the
most.

In Bangladesh under our current pension scheme, only 2 million government

employees are entitled to draw retirement pension and, poor and destitute people in old age
(above 60 years) are provided with a cash allowance of Tk. 400 (equivalent to USD 5) per
month and about 3 million people are enlisted under the Old Age Allowance scheme.
The Social Protection Programme since the 1990s has been catering to the extreme
poor of the society with a social safety net. Under current regulations, many taxpayers are not
entitled to any special healthcare for themselves or their family, their children's education, or
recognition from the state. Therefore, after retirement, they solely depend on their children or
their savings. This disproportionately affects the two genders because of the high disparity in
participation of women in government services and formal labor market in comparison to
men.
Secondly, Bangladesh has seen notable improvement in creating access to education,
especially at the primary level. In 2000, the country’s net enrolment rate at the primary
school level was 80 percent which has massively improved to reach 98 percent in 2015. The
Primary Education Stipend Program (PESP) of Bangladesh government has received massive
positive response since its advent in 2001. To achieve its key objective of increasing
educational participation-enrolment, attendance, persistence, and performance-of primary-
school-age children from poor families in urban and rural areas, it offers each student a
stipend of Taka 100 per month. The financial assistance is handed to child’s mothers,
contingent upon their child's school attendance; and has traditionally been disbursed in the
form of cash distributed from a designated school in the vicinity of the beneficiary's
residence.

"My daughter goes to the Ananda School. I am happy, we the women, have a say in
our children’s education now." -Nazma, mother of a student under PESP.
Hence, this program is also contingent on the assumption that cash transfers to the
mothers in the family directly improve the child’s present and future opportunities. Such
pensions may help families improve their bonds. Also, according to this experience of
Bangladesh, such a program can be quite popular even in poor countries, and these countries
can fund it with government revenue solely.

[2]
 Reference:
1. Tofail Ahmed, (2016, Feb 5) National Pension Scheme: Towards universal social-
security, The Daily Star.
Collected from: https://www.thedailystar.net/supplements/25th-anniversary-
special-part-5/national-pension-scheme-212701

2. Md. Azizul Islam, Civil Service Pensions in Bangladesh Current Reforms and Future
Plan. The World Bank.
Collected from: https://thedocs.worldbank.org/en/doc/588071548878983052-
0160022019/original/11.30amJan18PensionsAlamBangladeshreformconsiderations.p
df

3. Sharifa Begum, Old Age Allowance Programme of Bangladesh: Challenges and

Lessons. Bangladesh Institute of Development Studies (BIDS).
Collected from: https://ipcig.org/conference/south-south-learning-
event/presentations/Sharifa%20Begum.pdf

4. Alan Gelb, Anit Mukherjee, Kyle Navis, Mahmuda Akter, and Jannatul Naima (2019,
May). Primary Education Stipends in Bangladesh: Do Mothers Prefer Digital
Payments over cash? Center for Global Development.
Collected from: https://www.cgdev.org/sites/default/files/primary-education-
stipends-bangladesh-do-mothers-prefer-digital-payments-over-cash.pdf

5. Halrynjo, S., Kitterød, R. H., & Pedersen, A. W. (2019). A woman’s cause? Popular
attitudes towards pension credits for childcare in Norway. European Journal of Social
Security, 21(3), 241–261.
Collected from: https://doi.org/10.1177/1388262719869065

6. James, E., Edwards, A., & Wong, R. (2003). The gender impact of pension reform.
Journal of Pension Economics and Finance, 2(2), 181-219.
Collected from: https://doi.org/10.1017/S1474747203001215

[3]