How the Chilean pension system discriminates against women

How the Chilean Pension System Discriminates Against Women Abstract

In the previous pay-as-you-go Chilean pensions system, which is still effective for those who in 1981 were able to resist pressures to switch over to the FAP system, a woman had the right to retire at age 60 with an annuity identical to that of a 65-year-old male with the same salary and number of years of contributions, regardless of marital status or number of dependents. Conversely, in the FAPs today, a single 65 year old male receives a pension approximately one third higher than a 60 year old woman with the same initial fund.   Even should she renounce her right to retire at 60 and remain in the workforce until 65, the man’s pension will remain one sixth larger.

Two thirds of senior citizens are women, and women receive two thirds of public pensions. In the FAP system, on the other hand, women receive only 30%, whereas 70% are received by men. Clearly, the FAP system discriminates against women.