The Kosovar basic old age pension as universalist exception amidst clientelist fragmentation

Kosovo’s universal non-means-tested basic old age pension provides an income floor for all resident citizens aged 65 and over who do not qualify for other budget-financed schemes. It is regarded as administratively simple and cost-efficient. However, being a universal scheme, it is ill-equipped to provide for the clientelist needs of Kosovo’s politicians. To liberate budgetary resources, the Labour Ministry planned in 2016 to cut the zero pillar to finance the special schemes for war veterans and their families that have mushroomed in recent years, although no further progress has been made with implementation. This article argues that dismantling the basic pension is potentially harmful to the poorest strata of the elderly population and is, at the same time, also out of touch with Kosovo’s labour market realities. In its place, and to improve the design efficiency of the basic old age pension, it proposes a system of reform that, in line with the current orientation both of the IMF and the World Bank, addresses the linked problem areas of the system’s eligibility, taxation, benefits structure and administration.