ABSTRACT
Introduction The focus of this paper is on building and sustaining the institutional capacity for successful pension reform, particularly in African countries. In this regard, it is a contribution to the burgeoning debate on how Africa takes care of its old. The problem of old-age poverty is rarely the focus of policy in African countries, mainly because of the low life expectancy. However, changes in demographic trends occasioned by better health facilities, suggest that a grayer population is in the making. In addition, recent macroeconomic reforms and public sector downsizing has pushed pension reforms to the forefront of social policy agenda. Therefore, it becomes necessary to address research issues affecting the maturing population, both in order to understand the dynamics of poverty in the society as well as be able to make relevant policy prescriptions.Some of society’s most vulnerable groups may be found in the ranks of the old. In most African countries, only a small percentage of the old is taken care of through pension income accumulated while working in the formal sector. The larger majority relies on traditional safety nets, having spent their working life outside the formal sector. Pension reforms have important implications on poverty alleviation because pension income is a major link to the two main approaches to poverty alleviation, namely, economic growth and income redistribution. Experiences of emerging economies suggest that sizeable reduction in poverty is often achieved through the use of policies that stimulate growth and employment. With employment, income is provided for the poor, and with redistribution of income, those who are unable to benefit directly from the growth in employment, are taken care of.
