The National Social Security Institute (INPS) could fail to pay pensions to more than 200,000 state employees and agents due to a combination of factors, warns the Center for Public Integrity (CIP).

The Non-Governmental Organization (NGO) states that the civil servants' pension system is becoming increasingly unsustainable due to the increase in the number of beneficiaries/pensioners; the reduction in the number of contributing State Officials and Agents (FAE); and the lack of transparency in the management of funds and investments made by the INPS.

According to the NGO's study, between 2016 and 2021, due to restrictions on hiring new civil servants, the number of pensioners increased twice as much as the number of active civil servants, reducing the civil servant to pensioner ratio from 7.27 to 5.49. "This means that there are fewer and fewer civil servants contributing to the payment of a pensioner," we read.

CIP says that between 2022 and 2023, the pension system became overloaded due to the implementation of the Compulsory Social Security law; the Single Wage Table; and the inclusion of more than 5,000 former Renamo guerrillas in the pension system.

"The deterioration of the FAE/pensioner ratios, the inability of revenue to meet expenses, the reduction in the retirement age, the lack of an investment plan and the low rates of return are indicators that the civil servants' pension fund is becoming less and less sustainable. This situation could lead to the fund's inability to honor payments to pensioners," says the NGO.

On the other hand, the CIP believes that the lack of investment, coupled with the INPS' financial incapacity to pay pensions, increases the fiscal risk. Read more here the publication of the CIP.