Ensuring a Fair Balance between Contributions and Benefits across Generations
Dr Aaron G Grech
The 2016 pension reform established a very important concept to ensure that Maltese state pensions remain adequate and sustainable across generations. Without embedding an explicit automatic mechanism in the legislation, it introduced a requirement that policymakers look at a very important system parameter - namely the ratio between the number of years one must contribute to qualify for a full pension and the number of years one can expect, on average, to receive a state pension. Thus, while allowing individuals to continue retiring at the same pension age, this provision ensures that to get a full pension, individuals will have to contribute in a similar proportion as earlier cohorts. In line with the dispositions of the Social Security Act, given the publication of updated longevity projections following the previous pension reform, this paper assesses whether a further increase in contribution requirements is warranted.
Pensions Strategy Group, Supplementary Paper No. 3
https://endpoint-socialsecurity0001lwesa-agd2b3ekccdcasam.a01.azurefd.net/content/2026/07/2025-PSG-Report-Supplementary-Paper-3-FINAL.pdf