Impact of COVID-19 on Ageing and Retirement System: Key Policy Considerations

The authors attempt to conduct interdisciplinary research in epidemiology demography and pension economics. A literature was selected upon its relevance to the following key words: COVID-19, ageing and retirement system. The following methods are used: Historical content analysis, information, and analytical, comparative analysis. The analysis part is mainly based on secondary data of Committee on Statistics of the Republic of Kazakhstan and world recognized institutions’ reports such as World Health Organization, United Nations and World Bank. In the demographic analysis the traditional and alternative indices of population ageing such as Old Age Dependency Ratio (OADR) and Prospective Old Age Dependency Ratio (POADR) were widely used. By August 5, 2020, Kazakhstan has 94,882 registered cases of CVI, 67031 people recovered and 1058 deaths. Confusion in the demographic statistics of COVID-19 cases showed all the shortcomings. Even though the OADR and POADR ratios are rising in accordance with UN forecast, the global pandemic will adjust the population ageing, since the mortality of the elderly population from this disease is higher than in other age groups. The Kazakhstani retirement system has been suffered by the COVID-19 as well. Human losses, income poverty and increase in pension costs put a burden on state budget. The research presents recommendations on supporting measures in several directions that need to be taken by policy makers during post COVID-19 period in retirement system.

1. World Health Organization. (2020). Report of the WHO-China joint mission on coronavirus disease 2019 (COVID-19). https://www.who.int/docs/defaultsource/coronaviruse/who-china-joint-mission-oncovid-19-final-report.pdf(Date of access: 20 August, 2020)

2. World bank. (2020, June). Global economic prospects. https://doi.org/10.1596/978-1-4648-1553-9

3. United Nations, Department of Economic and Social Affairs, Population Division. (2020). World population ageing 2019. https://www.un.org/en/development/desa/population/publications/pdf/ageing/WorldPopulationAgeing2019-Report.pdf(Date of access: 20 August, 2020)

4. Kim, S., & Lee, J.W. (2008). Demographic changes, saving, and current account: An analysis based on a panel VAR model. Japan and the World Economy, 20(2), 236-256. https://doi.org/10.1016/j.japwor.2006.11.005

5. Bazzana, D. (2020). Ageing population and pension system sustainability: reforms and redistributive implications. EconomiaPolitica, 37(3), 971–992. https://doi.org/10.1007/s40888-020-00183-8

6. Dolls, M., Doorley, K., Paulus, A., Schneider ,H., Siegloch, S., & Sommer, E. (2017). Fiscal sustainability and demographic change: a micro-approach for 27 EU countries. International Tax and Public Finance, 24(4), 575–615. https://doi.org/10.1007/s10797-017-9462-3

7. Mitchell, O.S. (2020). Building better retirement systems in the wake of the global pandemic. SSRN Electronic Journal. Published. https://doi.org/10.2139/ssrn.3731009

8. Society of Actuaries. (2020, April). Impact of COVID-19 on retirement risks. https://www.soa.org/globalassets/assets/files/resources/researchreport/2020/covid-19-retirement-risk.pdf(Date of access: 20 August, 2020)

9. Kalil, A., Mayer, S., & Shah, R. (2020). Impact of the COVID-19 crisis on family dynamics in economically vulnerable households. SSRN Electronic Journal. Published. https://doi.org/10.2139/ssrn.3705592

10. VanDerhei, J. (2020). Impact of the COVID-19 pandemic on retirement income adequacy: Evidence from EBRI’s retirement security projection model®. SSRN Electronic Journal. Published. https://doi.org/10.2139/ssrn.3583426

11. McGrath, S. (2020). COVID‐19, human rights and older people. Australasian Journal on Ageing, 39(4), 328–330. https://doi.org/10.1111/ajag.12887

12. Bai, Z., & Wallbaum, K. (2020). Optimizing pension outcomes using Target‐Driven investment strategies: Evidence from three Asian countries with the highest Old‐Age dependency ratio*. Asia-Pacific Journal of Financial Studies, 49(4), 652–682. https://doi.org/10.1111/ajfs.12310

13. BBC - Homepage. (2020). BBC. https://www.bbc.com/(Date of access: 20 August, 2020)

14. Official portal on COVID situation of the Republic of Kazakhstan: coronavirus2020.kz

15. Izekenova, A. K., Kumar, A. B., Abikulova, A. K., &Izekenova, A.K. (2015). Trends in ageing of the population and the life expectancy after retirement: A comparative country-based analysis. Journal of research in medical sciences: the official journal of Isfahan University of Medical Sciences, 20(3), 250–252.

16. Ediev, D.M., Sanderson, WC., & Scherbov, S. (2019). The inverse relationship between life expectancy-induced changes in the old-age dependency ratio and the prospective old-age dependency ratio. Theoretical Population Biology, 125, 1–10. https://doi.org/10.1016/j.tpb.2018.10.001

17. Mortality risk of COVID-19 - statistics and research. (2020). Our World in Data. https://ourworldindata.org/mortality-risk-covid#case-fatalityrate-of-covid-19-by-age(Date of access: 20 August, 2020)

18. Official site of ministry of national economy of the republic of Kazakhstan committee on statistics. (2021). Official Site of Ministry of National Economy of the Republic of Kazakhstan Committee on Statistics. https://stat.gov.kz(Date of access: 20 August, 2020)

19. Official site of unified accumulative pension fund. (2020). Official Site of Unified Accumulative Pension Fund. https://www.enpf.kz/(Date of access: 20 August, 2020)

20. Agaidarov, A., Izvorski, I., & Rahardja, S. (2020). Kazakhstan economic update: Navigating the crisis. http://documents.worldbank.org/curated/en/155811595364689964/Kazakhstan-EconomicUpdate-Navigating-the-Crisis(Date of access: 20 August, 2020)