Fighting corruption and reforming the pension system: challenges facing the Moroccan government

The Observatory of Government Work, affiliated to the Al-Hayat Centre for the Development of Civil Society in Morocco, confirmed that among the most prominent challenges facing Aziz Akhannouch's government are the reform of the pension system and the fight against corruption.   

The Observatory revealed in a recent report that rising corruption has pushed Morocco down the Corruption Perceptions Index, from 73rd to 97th globally in five years. This reflects a growing spread of corruption in various sectors, as well as weak efforts to combat it. 

The Observatory indicated that the Akhannouch government has not yet been able to present a clear vision for tackling corruption, adding that government and administrative institutions have not been sufficiently involved in curbing the scourge.  

In an attempt to defend the government's policies, official government spokesman Mustafa Baytas confirmed that the fight against corruption is one of Rabat's main concerns.  

However, despite attempts to combat corruption, the Observatory for Government Action denounced a clear lack of commitment on the part of government and administrative institutions to implement the measures agreed within the framework of the anti-corruption strategy, warning that this lack of response will continue to weaken trust between citizens and the state, which may in turn hamper the government's efforts to attract investment and sustain economic development. 

Regarding pension reform, the Observatory warns that the civilian pension system is at risk of bankruptcy by 2028, as the system is expected to exhaust all of its reserves, forcing the state to pump approximately 14 billion dirhams a year to maintain the continuity of pensions for the benefit of retirees.   

In 2016, the government launched a standard reform of retirement systems based on three basic principles: increasing the value of contributions, raising the retirement age to 65 and reducing the value of pensions. This strategy means, according to the Observatory, that workers and public employees will have to bear almost all the costs of this reform. 

‘The choice of government is successful, but it is not enough,’ Idriss El-Fina, an economic expert, told Al-Arab, adding that ‘the question of governance is the real debate that needs to be opened, as the fund requires good management‘. 

Nadia Fettah, Minister of Economy and finance, called earlier this year in the House of Representatives to start reforming the system, aware that the financial situation of the basic pension and retirement systems remains difficult. 

Economic analysts consider that drought, high inflation and social demands for better wages are factors that will increase pressure on the pension reform issue, stressing the need for social dialogue between the government, trade unions and employers to arrive at a consensual and acceptable formula for reform. 

A recent report by the Central Bank of Morocco recommends implementing a systematic and coordinated reform of this sector, introducing a two-tier system - public and private - whose strategic guidelines were set out in the Social Dialogue Agreement.