Some data on Luz y Fuerza pension scheme

This weekend the Mexican president closured the public electric organism Luz y Fuerza del Centro (LyFC) that provided service to Mexico City and other nearby municipalities. The onerous pension scheme was one of the factors that explain the high deficit this public enterprise had every year (at about three billion dollars). Here some data that put into context the pension scheme of the workers of LyFC:

• The average pension over the average wage (an empirical measure of replacement rate) equals 2.12. For example this ratio in other pension scheme of public organism equals 0.8 in ISSSTE (old regime) and 0.7 in the oil company PEMEX. It has been calculated that workers of private firms will have a replacement rate at about 0.4

• The minimum age for retirement in old age is 55 years old, five years lower than in IMSS (own workers) and for workers of private firms, for example

• Early retirement was used to be granted with only 25 years of tenure, this number was 28 and 30 in ISSSTE and every years is increasing as a result of the recent reform to this pension scheme

• Average retirement age in LyFC thus fluctuates around 50 years old