The Political Economy of Reform in Brazil's Civil Servant Pension Scheme

This technical note discusses the civil servant pension system in Brazil over the past two decades. Since 1998 the Brazilian government has been implementing reforms to increase the financial sustainability of its pension schemes - seeking to contain pension deficits without hurting acquired rights. Reforms to the civil servant pension system are expected to cut the public deficit by more than 1.0 percent of GDP. These savings imply that while the civil servant system will continue to carry a sizable deficit over the medium term, it should decline over the long term. This note analyzes Brazil's pension systems, focusing on the scheme for civil servants - including the need for and implications of the recent reforms.