Tehran, IRAN — One of the key underlying economic challenges of Iran is the current underfunding of its pension system. Make no mistake: Pension reform must be a priority for the country. Figures posted by the Ministry of Cooperative, Labor and Social Welfare show that "a major portion of pension funds have either gone completely bust or are among the ones relying tremendously on state resources," reported Eqtesad News on Jan. 23.
The most important issues are the imposition of financial obligations by consecutive administrations over the past four decades as well as the approval of populist legislation by various parliaments, and particularly under the previous conservative government. Combined with the pension funds’ own financial problems, the situation is truly dire.