The "Chinese syndrome" of the contribution calculation, as a mirror of presumptuous social security virtues, has set the debate on pension reform back by about twenty years, making certain fundamental elements go out of sight. Listening to certain considerations, it seems that the pension system works according to the rules of a life insurance characterized by a package of fraudulent rules.
In fact, no life policy allows subscribers to obtain settlement ad nutum, at any age deemed appropriate, but a personal threshold is always envisaged, which, in the forms of supplementary pensions, for example, coincides with the age established for mandatory retirement. On the other hand, the idea is circulating that if the pension were commensurate with the contributions paid, there would be no reserves for applying the coveted criterion of the flexibility of retirement.
These theories circulate without anyone trying to demonstrate their inconsistency. In recent days, the writer happened to read a letter to a major newspaper in which a gentleman "struck on the road to Damascus" by the "magnificent and progressive fortunes" of the contribution calculation, claimed that it would be fair and correct to allow the possibility of retire, hypothetically, even at the age of thirty if the interested party were satisfied with a miserable allowance, such as that resulting from the amount of the few contributions paid.
Which would mean reducing the welfare state (understood as an institution that prepares and organizes the safety of citizens) to a sort of gambling house. Article 38 of the Constitution, in fact, is very clear when it states, in the second paragraph, that «Workers have the right to be provided with and ensure adequate means for their living needs in the event of accident, illness, invalidity and old age, unemployment involuntary".
And it establishes that these tasks must be provided by bodies and institutes prepared or integrated by the State, which cannot limit itself to ensuring any kind of protection, but to guarantee a threshold of adequacy which cannot disregard the available resources (social rights always have to deal with the unavoidable needs of economic and financial sustainability), but which must also be the guarantor of a suitable standard with reference to the "needs of life".
It is no coincidence that the constitutional legislator makes use of appropriate adjectives when it comes to defining the "means" to which, on the one hand, the citizen unable to work and indigent (referred to in the first paragraph) are entitled; on the other, the workers. In the first case, the rule limits itself to indicating a concept of "necessity"; in the second, however, it pushes towards the terrain of "adequacy".
However, these are concepts that include the value - more or less extensive - of the limit, since the organization of the social protection system must be sustainable and such as to even guarantee a relative balance between the generations, through a careful evaluation of the demographic, economic and occupational trends foreseen over the next few decades.
This is all the more true when the pension system is financed using the pay-as-you-go basis, a rule according to which the stock of existing pensions is "paid" by the amount of contributions (and taxes) collected from the generations of active workers, with the promise, guaranteed by the State, that when it's their turn to leave the job market, it will be the new generations of employed people who will honor the commitments that the system has taken on and recognize their accrued rights.
It would be enough to reflect on the transformations that have taken place, particularly in the labor market, to realize how difficult it is to maintain the correct functioning of the "chain of Saint Anthony" which links the generations, within the ambit of a compulsory pension system. However, focusing on just one of the aspects, it is correct to observe that even in the contribution model (also financed "by pay-as-you-go") there is no actual correspondence between the contributions paid and the service provided (as there would be on the basis of the capitalization criterion).
The calculation formula only serves to combine the parameters useful for defining the amount of the benefit (only aesthetes and cheaters dare to speak of "simulated capitalization"). The calculation mechanism (contribution amount revalued according to GDP X the transformation coefficients adjusted to retirement age) is only one way (undoubtedly more equitable than the "Italian-style" salary method) of determining the amount of the allowance.
But the balance of the system – in the years to come, even when the contribution will be fully operational – will depend on the ratio between the number of taxpayers and that of pensions paid or on the "same old story" of the balance between income (be it contributory or taxes) and outgoings (pension expenditure in its ratio to GDP).
When there was the reintroduction of the contribution system with the law n. 335 of 1995, the usual "beautiful souls" prophesied that a significant trend reversal would take place as the principle of solidarity would be replaced by that of rigorous correspondence between contributions paid and pension benefits.
Instead, as authoritatively written by Mattia Persiani, «it should be noted that the difference between the so-called wage-earning and contributory pension boils down to this: in the former, the amount of the pension is determined directly on the basis of the wages received, while in the second, reference is made to social security contributions and the age of entry into retirement. Reference - continues Persiani - which does not exclude the relevance of the salaries received (omissis). It follows that the different system for calculating the amount of pensions introduced by law no. 335 of 1995, as it only partially modifies the "pay-contributions-pensions" relationship, is not sufficient, by itself, to modify the function assigned to social security protection". Ipse dixit.
