pensions - AAFI-AFICS, Geneva - UNOG

THE PENSION FUND AT GENEVAInterview of Gilbert Ferrari, Chief of the Geneva Office of the Pension Fund, by Mr. J-M. Jakobowicz (cf. UNSpecial N° 602, July-August 2002), reproduced with the permission of the author, Editor-in-Chief, and Mr Ferrari.What is the history of the Pension Fund at Geneva?The Geneva office of the Pension Fund dates from 13 May 1975. With the passage of time, its responsibilitiesgradually increased, and in 1990 a group of consultants recommended a further development of its role. ThusGeneva is now responsible for 15 of the 18 affiliated organizations such as WHO, ILO, IAEA, IMO, UNIDO,UNESCO, etc., as well as nine large offices of the United Nations such as ECA, UNEP or ESCWA. Geographicproximity as well as familiarity with several European languages, better knowledge of national administrativeprocedures and retirees’ living conditions helped to deal with records and better assist active participants andretirees living in our region. The objective is to give Geneva responsibility for Europe, Africa and the Middle East.We look after 32,000 people out of 80,000, some 40% of the participants. As for pensioners who look to us forhelp, they are about 13,000 out of the total of 48,000 in receipt of monthly benefits. We aim to cover from here allthe organizations and UN offices based in Europe, Africa and the Middle East, and to serve and assist thepensioners living in these regions. In this way we would have administrative responsibility for 50% of theparticipants in the Fund, and establishing their benefits.How many of you are there in the service?At present we are 21, in two sections: participation, entitlements and contributions (13 persons) and finance andinformation technology (6 persons), plus an administrative assistant and myself.What does administrative responsibility imply in this context?Our role is to assist each employee of the international organizations from the moment he or she joins the PensionFund until he ceases employment, that is to say initial entry into the UNJSPF system, validation and eventualrestoration of previous service, explaining the implications of and choices between various administrative options(such as unpaid leave or breaks in service). Also providing estimates of pension entitlement at the time ofretirement, thus assisting a retiree in his choices within a pension system which, although of high quality, isinevitably complex due to the need to cover disparate situations, both as regards place of work and place ofretirement.Our role in advising on the different options, on advantages and disadvantages, in the light of what an individualsays are his needs, is large and has wide implications. There is a sharing with the future pensioner who confidesin us part of his life, his expectations, his fears, his hopes; in a way a certain intimacy develops, and rather thanbeing just a professional job, it is a human relationship that results. He tells us about his life, we advise him so thathe can make his choice on what will largely determine his future new life as a pensioner. In accordance with hischoice, we therefore have the responsibility of calculating his entitlement and paying it. Paying his entitlementimplies paying the first monthly pension (including it in the monthly payroll of the Fund), paying the lump sum if thishas been requested, or paying a withdrawal or residual settlement.What can you say about the choice of taking a lump sum or not?Various factors have to be taken into account when making this choice. There are technical factors which we canshare with the beneficiary. But during our dialogue we also stress the importance of personal factors, and, if hewishes, as is frequently the case, we weigh up all the diverse aspects so as to arrive at the best choice in hisparticular case. Among the technical factors, two are of greatest importance:On the one hand, remember that, with the well-known exception of Austria, every retired international civil servantresident in Europe has to pay income tax on the basis of his monthly pension. His income tax liability will thereforebe reduced if he lowers this monthly amount by taking one-third as a lump sum. That is a positive financialelement. In fact the same applies in most countries outside Europe.28