Impact of migration on pension systems
The situation in Italy
JS – 02/2020
The Italian
social security institution INPS (https://www.inps.it) is currently examining
the impact of migration on the Italian pension system.
A large
proportion of the immigrant population is young, making them important
long-term contributors to the rapidly ageing Italian society. Immigrants are
also more willing to take on work that Italians do not want to do, for example,
doing harvesting work.
Another
factor is the loss of Italians with a technical or university education who
move abroad, which further increases the need for contributors.
As such,
immigration seems essential for the Italian pension system.
According
to experts, including those from the statutory pension insurance system, the
positive effects of migration are confirmed by taking a look at public
finances. The social security contributions and income taxes paid in Italy by
immigrants exceed the social expenditure for immigrants by billions.
And the long-term view?
The
long-term impact of immigration on the pension system will be monitored using
further information such as population growth within the immigrant population.
In terms of
social security law, Italy already boasts a good track record of integrating
immigrants. In 2002, a law was passed that allow a migrant without a prior work
permit to obtain a residence permit and a work permit. An employer only has to
pay €700 worth of social security contributions and offer an employment
contract for one year. The result is that around 700,000 people, e.g. from
Albania, have been integrated into the social security system on a long-term
basis as contributors.
And in Germany?
Given the
ageing German population, it can also be assumed that the German economy and
pension system are dependent on immigration. However, no specific conclusions
can be made from data provided by the German pensions insurance system with
regard to people with a migration background. Statutory pension insurance only records
the citizenship of a person. As a result, anyone who has taken on German
citizenship during the course of their insured life cannot be distinguished
from those who have had German citizenship from birth.
You can find more
information for Germany on this topic in: ‚Ausländische Versicherte und
Rentenbezieher in der gesetzlichen Rentenversicherung‘, Biber, Ulrich,
Stegmann, Dr. Michael, Deutsche Rentenversicherung Apr 2019 (German only).