Of all the ?painful? measures announced in Finance Minister Sithanen?s budget this year, undoubtedly the most painful is the proposal to extend the retirement age from the present 60 to 65 in future years. To my mind, there are three very good reasons why this measure should be given a peaceful death even before its birth onto the statute books.

According to official figures, the unemployment rate has been hovering around the 10 percent mark for some time now and shows no sign of abating, in spite of various measures announced by the previous MMM-MSM and the present Alliance sociale governments. With the regression of the sugar and textile industries, this situation is likely to deteriorate in the coming years. For various reasons, the nascent ICT and the other ?hubs?, even if they were to expand at a faster rate than they have done up to date, are unlikely to have the capacity to soak up a lot of the ensuing unemployment.

Some of the unemployed are simply too old or lack the requisite level of education to be retrained for the new jobs. With the advent of the new retirement age, those youngsters who are required to enter the labour market will in future have to remain idle for five years before they can do so. If we add to all this the very real possibility of what economist term ?a jobless growth?, then it is all too probable that the unemployment rate will get worse in the short, medium and perhaps even the long term.

Moreover, every survey carried out during the past few years indicates that our efficiency and our productivity are on the decline. There may be many reasons for this: old or obsolete machinery, inadequate management control and our tradition of ?lundi cordonnier? to name just three. It is also an observable fact that, as people get older, they take longer to perform the same task that a younger person can do in a shorter time.

It is also known that a large number of our compatriots start to develop health problems at around the age of fifty, if not earlier. These are mainly, but not exclusively, the dreadful triad which consists of diabetes, hypertension and cardiovascular disease, the most common NCD?s in Mauritius.

It does not take too such imagination to work out that the combination of an aging and aged workforce and failing health can only result in a lower and disastrous productivity level. This in turn will impinge on the profitability of firms and may eventually lead to the closure of many an enterprise, thereby exacerbating the unemployment situation further still.

Latest statistics tell us that the average life span of Mauritian men is 69 and that for women it is 72. For the purpose of this exercise, let us take the example of a typical working man who has managed to survive till his retirement age of 65, in spite of suffering from the above-mentioned NCD?s.

<B>Man treated as a factor of production</B>

We can only imagine the state of his physical and mental health with which he can look forward to living for the next four years while he awaits his demise. Even in the absence of empirical data, common sense will tell us that the cost of looking after our retired worker is likely to shoot up in terms of health provision and social benefits. It can be argued that some of this extra cost will be offset by the additional contributions he would have made whilst working. But, will it be enough ? Has anyone carried an actuarial calculation to establish that there will not be a mismatch in the cost-benefit flows?

It is obvious that, true to his reputation of being a fine technocrat, Mr Sithanen has taken only the economic arguments into consideration, criteria so dear to the IMF. But, in so doing, the Finance Minister has paid short thrift to the dictum that ?man does not live by bread alone?. By extending the retirement age to 65, we are treating man as just another factor of production to be discarded only when obsolescence is imminent. In order to live a fulfilling life, man needs to feel integrated not only economically, but also socially and culturally in his society. Otherwise, the consequences can be so grave that our very wellbeing as a nation may be seriously compromised.

Those who argue that we should follow the example set by many (Western European) countries and extend the retirement age to 65 conveniently ignore the difference in the constitutional make up of Europeans compared with that of the average Mauritian. Not only are the former stronger and live much longer than us, but also they are better fed and better looked after from the womb right through to the grave.

Also, since there are more leisure facilities available to them, it can be argued that their life is less stressful than ours, as everyone can while away his cares by indulging in his favourite pastime. In Europe, even a manual worker such as a dustman can look forward to at least one annual break in a holiday resort, a privilege reserved to only a select few over here.

In Mauritius, the best his counterpart can hope for is the occasional day out to an ever-receding and overcrowded beach. Then, there is the effect of climate on the performance of the human body. We can all be able to work harder and longer in cooler conditions than when it is boiling hot. No doubt, that is the reason why people who can afford it have air-conditioners installed in their premises, whether this be an office or a house.

So, what do we do about pensions in the face of an aging population if we choose not to increase the retirement age ? I do not profess to be an economist or a financial expert but have been around long enough to have a stab at some suggestions, based on the experience life has taught me.

For a start, we can stop using the pension fund for any other purpose than what it is designed for, that is PENSIONS. We should ensure better fund management by hiring appropriate investment expertise ; placing funds in mostly local fixed deposits ? as seems to be the current practice ? is probably not the best strategy. The burden of the universal pension should be gradually phased out and replaced by a fully contributory alternative. It is not only unfair that those employed in the formal sector should be expected to subsidise forever those in the informal sector because they have no other choice, but also this partly explains the shortfall in adequate funds. In future, everyone wishing to receive a state pension should be required to contribute to the NPF. I leave the calculation of the level of contributions to those better qualified to do so. But, one thing is for sure : as we are fast learning to our great cost, Government cannot afford to go on playing Father Christmas on the back of those who have no choice but to contribute.

And how about changing the validity of motor vehicle driving licence from the present 60 to 65 years. If we are considered fit enough to work till we are 65, we are presumably fit enough to drive ourselves to work till that age.

<B>Toro Del Fugo</B>