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Population ageing and international developmentFrom generalisation to evidence$

Peter Lloyd-Sherlock

Print publication date: 2010

Print ISBN-13: 9781847421920

Published to Policy Press Scholarship Online: March 2012

DOI: 10.1332/policypress/9781847421920.001.0001

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Ageing and development in Argentina

Ageing and development in Argentina

(p.170) (p.171) Seven Ageing and development in Argentina
Population ageing and international development

Peter Lloyd-Sherlock

Policy Press

Abstract and Keywords

The study looks at the case of South Africa and pays particular attention to relationships between later life and race. The history of South Africa has been framed by issues of race and colonisation, and they continue to shape the country's experiences of population ageing until today. Its development was driven by the mining sector, which depended on large supplies of migrant African labour. This gave rise to divided families and complex patterns of social relations. The Apartheid system also formalized discrimination between racial groups, and as a result, experiences of later life vary profoundly across different racial groups. Population ageing is set in a wider context of fertility transition, as well as shifts in life expectancy, living arrangements and the impact of the AIDS epidemic. The chapter focuses on the impact of the HIV/AIDS epidemic on older people, along with the effects of the country's extensive social pension programme.

Keywords:   South Africa, later life, race, social pension programme, population ageing, migrant African labour, AIDS


Argentina is a relatively wealthy country, with an embracing welfare system and an aged population structure. As such, it may offer insights relevant to the future for other developing countries. Despite this, it is widely accepted that Argentina’s economic performance over the past 70 years has been poor and erratic. The causes of this decline are complex, but this chapter will seek to assess whether population ageing has played any role in hindering growth. The chapter will also consider how this gradual decline has affected experiences of ageing and the lives of older people. It follows broadly the same structure as the other country case studies in this book. First, it provides a brief overview of Argentina’s economic and social development. This is followed by an analysis of demographic trends, including fertility transition and population ageing. The chapter then focuses on a number of key themes. In this case, they cover potential economic impacts of population ageing, as well as the provision of social security and health services, and the care economy. These more general analyses are complemented by three life histories of older Argentines, which reveal the diversity of old-age experiences and the different ways in which national factors intersect with personal biographies.

Social and economic development in Argentina

In the first half of the 20th century, Argentina was one of the richest countries in the world. In terms of development and social welfare, it was seen as much closer to Australia, Canada and New Zealand than to its Latin American neighbours (Platt and Di Tella, 1985). By the end of the 20th century, decades of extreme economic instability and growing social inequality had relegated Argentina to ‘developing country’ status. The scale of Argentina’s relative decline was dramatic: in 1950, average per capita incomes were still 84% of the Organisation for Economic Co-operation and Development’s, by 1987 they had (p.172) fallen to only 43% (Della Paolera and Taylor, 2003). The Argentine experience demonstrates that development should not be understood as an inevitably linear and irreversible process. Current cohorts of older people were born into a prosperous country and lived through its decline, which will have shaped the courses of their lives and their situation in old age. As such, Argentina provides an unusual, but enlightening case study of ageing and development issues.

The first colonial Spanish settlements were established in Argentina in the mid-16th century. From that time until the country achieved independence from Spain in 1810, it was a sparsely populated, impoverished colonial backwater (Lewis, 2002). The most developed region was the north of the country, which provided food and supplies for colonial mines in Peru and Bolivia. For most of the colonial period, European ships were not permitted into Buenos Aires, stifling its development. Following independence, the fortunes of Buenos Aires and northern Argentina reversed, reflecting a profound reorientation of the country’s economy. Argentina might have lacked the precious stones and minerals that had originally drawn the Spanish to Latin America, but it possessed one resource in abundance: the vast, fertile plains of the Pampas. This large area, centred around Buenos Aires, has a temperate climate and is ideally suited for livestock ranching, as well as the production of wheat, corn and other western staples.

From the mid-19th century, several factors combined to initiate what would become one of the most sustained periods of rapid economic growth the world has ever seen. These included domestic political stability and massive increases in demand for meat and cereals in the fast-industrialising economies of Europe, particularly Britain. Between 1876 and 1900, exports of wheat grew from 21 to over two million tons, and there was a similar increase in the volume of fresh beef exports (Lewis, 2002). The Argentine boom was supported by huge inflows of foreign investment, funding the development of infrastructure such as railways linking the Pampas to Buenos Aires. While cattle-ranching and wheat farming were not as labour intensive as South African mining, Argentine development still required large inputs of population (Castro, 1991). As with South Africa, the economic epicentre was sparsely populated, mainly by nomadic indigenous groups. Unlike South Africa, most of these were killed in a genocidal military campaign between 1879 and 1880, leaving the Pampas region a white, settler economy. From the 1870s, huge numbers of European migrants came to Argentina, drawn by the attractions of easy money and free ocean passages paid by the government. Between 1880 and 1930, net immigration was over three million, accounting for around (p.173) half the country’s total population growth (Sánchez-Alborñoz, 1974). The largest concentrations of immigrants were from Italy (55%) and Spain (26%). This wave of immigration had a profound impact on the demography of Argentina: for example, in 1914, 63% of the urban population were foreign born.

Between 1880 and 1930, the Argentine GDP grew at an average annual rate of 5% a year (Diaz-Alejandro, 1970). This transformed the economy and society of the Pampas region and, in particular, Buenos Aires, which emerged as a prosperous cosmopolitan metropolis, more comparable to New York and Chicago than Mexico City or Lima. The protracted export boom enabled the development of an incipient social welfare system, with investments in sanitation, public health and education. Between 1869 and 1947, the total rate of illiteracy fell from 73% to just 12%.1 In the larger cities, there was a growing network of state and charitable hospitals, offering a relatively comprehensive range of services (Recalde, 1991). The export boom also spurred political change. European migrant workers brought with them new political ideologies, including revolutionary bolshevism. An increasingly prosperous and educated population started to pressure landowning elites to establish a more democratic system of rule. In 1916, Argentina held its first recognisably democratic presidential elections, based on universal male suffrage (voting for women was not introduced until 1947). Beyond Buenos Aires and the Pampas, the pace of economic, social and political change was much slower, leading to marked regional disparities, which have endured ever since.

Between the First World War and the 1929 Great Depression, the Argentine export boom began to lose momentum. The precise reasons for this are complex and the subject of sometimes heated debate, but contributing factors included the loss of key European markets and the exhaustion of fertile virgin Pampas farmland. Further export growth required raising output per unit of land in an increasingly competitive international marketplace. The main policy response was to shift the focus of development towards manufacturing, as part of what became known as ‘import substituting industrialisation’ (ISI). According to this strategy, local industries were offered large amounts of state support in the form of subsidies and protected local markets (by taxing manufactured imports). It was hoped that these protected industries would eventually be able to compete internationally without state support. By 1947, one and a half million Argentines were employed in industry, almost as many as in agriculture (CEPAL, 1959). At the same time, there was a rapid growth in public sector employment, which trebled between 1930 and 1955. As with the export boom, the new (p.174) industrial model was mainly focused on and around Buenos Aires, leaving other regions to languish (Sawers, 1996).

The new industrial development model considerably strengthened the political influence of the urban working class, and this contributed to the political emergence of Peronism in the 1940s. Juan Perón’s first period of rule, from 1944 to 1955, is still seen as a political, social and even cultural turning point in Argentina’s development. Before his rule, notionally democratic politics had been dominated by elite and urban middle-class interests. Perón drew his support from mass, populist appeals to the urban working classes and rural poor, forming a tight political alliance with labour unions. Although social welfare programmes were already quite well developed in Argentina, Perón came to be associated with the establishment of a generous and embracing welfare state. This included significant extensions in health insurance and pension provision. The industrial development of Buenos Aires and other large cities such as Rosario and Córdoba attracted large flows of rural migrants, especially from poorer provinces to the north. These were joined by migration from neighbouring countries such as Bolivia and Paraguay. By contrast, overseas immigration from Europe became much less significant from the 1930s (Torrado, 1994).

Argentina’s new industrial development strategies never yielded the sustained high levels of growth generated by the previous export boom. Local industries remained heavily dependent on state support and struggled to become internationally competitive. Their expansion was hindered by a lack of conveniently located raw materials and the small size of Argentina’s market. Powerful unions meant that labour costs were substantially higher than in other industrialising economies. Also, the political continuity of the export boom had given way to an increasingly unstable situation. In 1955, Perón was ousted by a military coup. The following decades saw a succession of short-lived regimes, some democratic, some military, including a disastrous second period of Peronist rule in the early 1970s. This political instability was underpinned by profound differences of opinion about the best path for Argentine development: whether the country should return to its liberal heyday of rural exporting, or whether it should continue to pursue state-led industrialisation. By the 1970s, inconsistent economic policies and inefficient industries meant that the ISI model of development had effectively run out of steam. Both the country’s politics and economic performance became increasingly unstable, leading to the notorious ‘Dirty War’ of 1976 to 1983, when a repressive military government murdered up to 30,000 of its own citizens.

(p.175) By the late 1980s, the social consequences of Argentina’s poor economic performance were becoming more obvious. In 1970 (the first year for which data are available), only 5% of households in Greater Buenos Aires had incomes below the official poverty line; by 1985 this had reached 22% (Table 7.1).2 Falling industrial employment contributed to a growing informal economy, paralleled by a rapid expansion in shanty towns on the peripheries of the larger cities (Yujnovsky, 1984). At the same time, increasing pressures were put on funding for social welfare programmes and some were cut back (Minujin, 1992). In 1989, Argentina experienced the first of several hyperinflationary episodes, which dwarfed its previous economic crises. In the same year, Carlos Menem, a Peronist, was elected president, marking a significant new phase in Argentine development.

Table 7.1: Estimates of household poverty for Greater Buenos Aires, 1970–2005


% of households below poverty line


% of households below poverty line

















Source: Lloyd-Sherlock (1997a); INDEC (2008)

Menem remained in office until 1999 and oversaw a radical shift in policy towards right-wing neoliberalism. Subsidies for inefficient industries were cut, trade barriers were removed, state-owned enterprises were privatised and efforts were made to reduce labour costs. Most significantly, strict measures were introduced to control inflation, by linking the local currency to the US dollar. Initially, the new policies worked: inflation was virtually eliminated, exports increased and privatisations generated substantial revenue for the government. By the mid-1990s, Argentina’s international reputation had been transformed from an economic disaster to a ‘poster-boy’ for the benefits of World Bank neoliberal policies (Blustein, 2005). Yet in spite of rapid economic recovery, unemployment remained high and it was evident that the benefits of the new model were not trickling down to the poor (Table 7.1). As part of the new policy model, several aspects of the welfare system, including pension programmes, were either downgraded or privatised.

The neoliberal boom lasted until the late 1990s when a combination of factors began to undermine the new development (p.176) strategy. Eliminating inflation led to an overvalued peso, reducing the competitiveness of exports. The privatisation programme lost momentum, as the government ran out of assets to sell. Menem’s political position weakened and the unions became increasingly adept at defending wages and labour conditions. In 2001, the neoliberal revolution ended just as abruptly as it had begun. The government was finally forced into devaluing the peso, unleashing a massive economic crisis. In a single year, GDP fell by 28%, while unemployment and the poverty rate both doubled (Fiszbein et al, 2002). Since then, the economy has recovered from most of these losses and exports have benefited from rises in global food prices. There is, however, little evidence that the Argentine economy has broken free of its long-term cycle of decline and instability. Since 2002, the country has elected Peronist presidents, who promise to return to the core Peronist welfare traditions of the 1940s.

Argentina’s unusual economic trajectory raises a number of important issues relating to population ageing and development. Early 20th-century prosperity enabled the creation of a fairly embracing welfare state, including contributory social insurance pension funds and a range of healthcare programmes. In more recent decades, this welfare infrastructure has been increasingly under pressure, which will have had particular effects on groups such as older people. At the same time, some have argued that the costs of maintaining these social policies have contributed to Argentina’s lack of international competitiveness (World Bank, 1997; IMF, 2004). This links into wider debates about the potential economic burden of population ageing (see Chapter One).

The country’s changing fortunes will have done much to shape the lives and experiences of its older population. Current cohorts of older people reached adulthood in the 1950s and 1960s, when industrial and public sector employment were readily available and wages were still high (Roxborough, 1993). In the main, they were well educated and politically active, either as Peronists or in opposing factions. As they progressed through adulthood, many will have experienced increasing economic insecurity and a gradual decline in living conditions. This cohort will have reached old age at a time of welfare privatisation and retrenchment. High levels of unemployment and a growing informal economy mean that, as in South Africa, many of this cohort’s children and grandchildren will be facing economic distress, with implications for patterns of family support and intergenerational relationships. More broadly, older people in Argentina today reached adulthood at a time of relative optimism—few foresaw the extent of national decline that occurred in the latter decades of the 20th century. For most of this (p.177) cohort, these expectations of a more prosperous future were never realised, and this was paralleled by a shift from idealism to disillusion and political disengagement.

Population dynamics and development in Argentina

Argentina experienced demographic transition considerably earlier than most other developing countries. Sustained falls in fertility began around the end of the 19th century, closely following mortality declines (Table 7.2). By 1947, fertility had fallen to levels not seen in Latin America as a whole until the 1990s. The shortness of the lag between mortality and fertility decline limited the growth of the local population, increasing the importance of immigration for the country’s development (Table 7.3).

Table 7.2: Indicators of demographic transition in Argentina and Latin America

Total fertility rate, Argentina

Total fertility rate, Latin America

Crude death rate, Argentina

Crude death rate, Latin America









































Notes: * Average for 1890–95.

** Average for 1910–15.

Sources: Lattes (1974); United Nations Population Division (2008)

Table 7.3: Total population and per cent foreign born, Argentina


% foreign-born

























Sources: Lattes (1974); UN Population Division (2008)

(p.178) The early onset of demographic transition was essentially a consequence of Argentina’s export boom of 1870 to 1930. Rapidly increasing prosperity, along with improvements to sanitation and extensions to public health infrastructure, underpinned improvements in life expectancy, especially for young children. For example, the proportion of children born in Buenos Aires who died in their first year of life fell from 33% to 7% between 1870 and 1930 (Nari, 1996). The export boom also promoted urbanisation and access to education, which are commonly associated with reduced fertility. By 1914, two thirds of the population were literate and over half lived in cities. These effects overrode population policies, which sought to slow the fertility decline in response to fears of depopulation and that the local population might be ‘swamped’ by the waves of immigrants (Rock, 1991). Despite these sentiments, modern contraceptives, including condoms, were readily available and being widely used in Buenos Aires and other cities from the 1920s (Nari, 1996).

The effects of demographic transition on Argentina’s population growth and age structure were heavily modified by mass immigration. The great majority of immigrants were working-age adults and few arrived with families. Since fertility rates in Italy and the other host countries were significantly lower than in Argentina before the 1920s, it is likely that immigrants had fewer children than the native population. This would have accelerated the overall pace of fertility decline (Pantelides, 2006). The impacts of the export boom and large-scale migration were much less evident outside Buenos Aires and the Pampas. This led to large regional disparities in demographic trends. For example, total fertility did not start to fall in the northeast until the 1950s and several Argentine provinces still had TFRs of over four in 1980. Life expectancy at birth in Buenos Aires was 68 years in 1960, 11 years greater than for north-western Argentina.

Rapid and early fertility transition led to rapid and early population ageing. Table 7.4 shows that the total number of people aged 60 or more roughly trebled between 1950 and 1980. More recently, Argentina has seen accelerating growth of its oldest old, so that in 2008 the total population aged 80 or more reached one million. Regional variations in fertility, life expectancy and migration produced sharp internal differences in population ageing. For example, by 1960, 9.5% of the population of Buenos Aires city was already aged 65 and above, compared with only 2.5% of the northern province of Jujuy. Given that political and economic power was heavily concentrated in Buenos Aires, this may have increased the potential impact of ageing on development priorities. Table 7.5 shows the large variations in population ageing (p.179)

Table 7.4: Population ageing in Argentina, 1950–2000

60+ (%)

80+ (%)

60+ (000)

80+ (000)































Source: United Nations Population Division (2008)

Table 7.5: Regional comparisons of population ageing and education, 2001 (%)

Population aged 65+

Illiteracy rate for men aged 65+

Illiteracy rate for women aged 65+





Buenos Aires city








Santiago del Estero




Source: INDEC (2008)

across Argentina in 2001. It also gives some indication that experiences of old age varied sharply between regions: older people living in Buenos Aires were almost all literate, while in poorer provinces a significant proportion, especially of women, were not.

Unlike most other developing countries, Argentina has been experiencing population ageing for a long period. It is therefore instructive to assess how this trend may have affected the country’s general development experience. Put crudely: has the growing population of older people been a significant factor contributing to Argentina’s poor economic performance?

Assessing the economic impacts of population ageing

Chapter One argued that identifying obvious links between demographic change and economic growth is extremely difficult, even in developed countries where population ageing is relatively advanced. First, population ageing needs to be located in a wider context of demographic change, including reductions in mortality and fertility. Most studies of international development stress the economic advantages of rapid fertility transition, since this slows overall population growth and reduces pressure on available resources. High levels of fertility are associated with large numbers of young children, who are (p.180) usually economically unproductive and absorb significant amounts of resources. It follows that, all things being equal, Argentina’s rapid progression towards low fertility rates would have boosted the country’s economic performance. In fact, it has been argued that Argentina’s fertility transition did not happen quickly enough. Taylor (1992) claims that the main reason Argentina fell behind economies such as Australia and Canada was because its birth rates were significantly higher. He argues that large numbers of children boosted per capita consumption, hence reducing domestic savings rates, which, in a context of scarce international capital, restricted economic growth.

It is also possible to develop equally plausible arguments that Argentina might have benefited from higher fertility rates. This was clearly the view of policy makers during the export boom, giving rise to pro-immigration and pro-natalist policies (Castro, 1991). Slow population growth limited the supply of workers, increasing labour costs compared with competing economies and boosting the bargaining power of labour unions. It also reduced the size of the domestic market, which became increasingly important during the years of ISI. As a result, Argentina fell behind countries like Mexico and Brazil, both of which experienced rapid population growth and economic booms between the 1950s and the 1970s.

Given these different effects, it is difficult to weigh up the overall impact of rapid fertility decline on Argentina’s economic performance. The same can be said for the impact of population ageing. Table 7.6 summarises widely held views about the most likely effects of population on economic performance. Put simply, all of these effects suggest that population ageing is bad for the economy. Chapter One provided a detailed assessment of these potential effects and concluded that they are usually more complex and less predictable than is commonly assumed.

Table 7.6: Standard views about the economic impacts of population ageing


Standard view

Dependency rates

Population ageing increases the share of population that does not work, reducing its overall productivity

An ageing workforce

Older workers are inherently less productive than younger ones

Resource allocation

Older people consume disproportionate amounts of public and private resources (pensions, health services and care). This reduces resource availability for more productive investments


People divest savings in later life, which depresses the overall savings rate

(p.181) In the case of dependency ratios, rising numbers of older people must be offset against changes in numbers of children (and Argentina still contains around twice as many people aged under 18 than over 60). Also, assumptions about the rate of economic activity of different age groups must be put to the test, particularly in settings where productive employment opportunities are limited. Table 7.7 shows that Argentina’s old-age dependency rate increased substantially between 1950 and 2000. It also shows that in 1950 a substantial proportion of older Argentines were in work or seeking employment, but by 2000 this had fallen sharply. This decline in old-age economic participation was mainly due to the extension of pension schemes. Since relatively few older people were working, the productivity effects of an ageing workforce (which are themselves highly contentious) are unlikely to be significant. A combination of demographic ageing and declining later life activity rates will have significantly increased the share of the population who are ‘economically inactive’. Nevertheless, comparing the old-age dependency ratio to the total dependency ratio shows that falling proportions of children have partly compensated for this effect.

Table 7.7: Dependency rates and labour force participation, 1950–2000




Old-age dependency rate*




Labour force participation for population aged 65+ (%)**




Total dependency rate***




Notes: * Number of persons aged 65 and over per 100 persons aged 15 to 64.

** % of age group either in employment or actively seeking employment.

*** Number of persons aged 65 and over plus number aged 0 to 14 per 100 persons aged 15 to 64.

Source: United Nations Population Division (2002)

The links between a growing inactive population and economic performance are neither automatic nor simple. First, it is necessary to consider whether jobs would have been available for a larger working population. In the case of Argentina, unemployment and underemployment increased significantly from the 1970s and have remained stubbornly high, suggesting that the country would have struggled to accommodate more workers.3 Second, levels of consumption among the inactive population need to be assessed. Hypothetically, if Argentina devoted no resources to its inactive population, this group could be considered as neither productive nor a burden. By contrast, if older people are unproductive and absorb (p.182) large amounts of resources (through public policies such as pensions as well as private transfers at the household level), population ageing is likely to have a large economic effect. The following sections attempt to gauge this effect, examining resource consumption by older people in three areas: pensions, health policy and LTC.

Social security and pension provision for older people

By the 1950s, Argentina had established an extensive set of pension programmes. Over time, these became increasingly expensive to run, and by the late 1980s they absorbed funding equivalent to 8% of the country’s GDP. In 1990, as Argentina experienced an acute hyperinflationary crisis, government support for the social insurance system accounted for a quarter of all public spending (Bucerius, 2003).4 Undeniably, the high cost of supporting the pension system made a significant contribution to a mounting fiscal deficit, which was itself a major cause of the wider economic crisis. This would appear to be powerful evidence that the resource requirements of ageing populations can have significant economic effects. The rest of this section considers how Argentina reached this critical juncture and the extent to which population ageing was to blame.

In 1904, Argentina became the first Latin American country to adopt a Bismarckian social insurance programme, when a compulsory retirement fund was established for government workers (Lewis and Lloyd-Sherlock, 2008). Over the following decades, separate schemes were set up for other influential occupations, including railwaymen (1919) and bank workers (1923). The early years of Perón’s first government, in the mid-1940s, saw a substantial extension of state pension schemes, with the creation of contributory funds for industrial workers and the commercial sector. In 1954, schemes were established for the self-employed and rural workers, although only a small minority of these groups ever became affiliated. As a result, the proportion of the economically active population included in the national pension system rose from 4% in 1944 to around 65% in 1954 (Ross, 1989).

The expansion of pension provision broadly coincided with the onset of population ageing: by 1950, the country contained over a million people aged 60 or more. By this time, several influential academic and political figures were warning of the need to respond to a growing older population, with measures including pension provision (Bunge, 1940; Germani, 1955). Rather than as a direct response to population change, however, the rapid expansion of the pension system is usually explained in terms of political machinations between the government (p.183) and trades unions. During the 1940s, Perón established a close alliance with the labour movement, whereby the government offered trades unions a range of welfare benefits in return for their political loyalty (James, 1988). As part of this, some labour leaders were offered key roles in state agencies responsible for supervising the pension funds.

There is no evidence that the labour unions were motivated by general concerns about providing for future cohorts of older people. Instead, their main goal was to obtain generous retirement packages for their own memberships. In this, they were very successful: the new pension schemes included an 82% final salary replacement rate and attractive early retirement packages (Feldman et al, 1988). At the same time, worker contributions were relatively low, ensuring the schemes’ popularity. Over the long run, this would lead to a large imbalance between resources being paid into these pension funds and their financial liabilities. Initially, however, the pension funds seemed to be awash with money. The main reason for this was that very few people inscribed in the newly established funds had yet reached retirement, and so the ratio of contributors to pensioners was still very high.

Extending the pension system was just as attractive to the Argentine government as it was to the unions. First, it ensured the political support of the labour movement, which was essential to its ISI strategy. Second, extending the pension system had brought in large numbers of new contributors who bailed out the deficits of the older funds. Many of these old funds were organised on even more generous principles than those set up under Perón, and this had quickly undermined their financial positions. For example, by 1939, the railway scheme had less than half of the funds needed to cover its long-term pension obligations (Lewis, 1993). Broadening the net of participation initially boosted the overall ratio of contributors to pensioners and kept the pension system afloat. The resulting temporary surpluses represented a large pool of funds that the government could draw on to finance its increasingly ambitious ISI projects.

The 1950s and 1960s saw no significant changes to the pension system, other than the centralisation of separate pension funds into unitary state agencies. This stability reflected the enduring power of the labour unions and the importance of a cooperative, efficient workforce for the pursuit of ISI development. Despite this continuity, the financial position of the pension system was transformed, as growing numbers of workers started to reach retirement age. Between 1950 and 1965, the number of benefits being paid out rose from 188,000 to 1,086,000. Many workers took advantage of early retirement, so that by 1966 over a quarter of pensioners had retired aged under 50 years old (Feldman (p.184) et al, 1988). Past surpluses had been poorly invested, generating low and even negative rates of return, and levels of contributor evasion were very high. Inexorably, the pension system as a whole began to suffer from large and growing financial deficits.5 During the 1970s and 1980s, the number of pensioners continued to rise and the financial crisis deepened. The average value of pensions fell increasingly short of the official 82% replacement rate, reaching only 43% in 1986. Efforts were made to increase contributions and the age of retirement, but these were resisted by both employers and unions. A growing informal sector and falling wages made further inroads into the shrinking pool of contributions.

By the 1990s, it was clear that the pension system required a radical overhaul. The collapse of the ISI growth model and an associated reduction in the power of the labour unions ended the political alliances that had underpinned existing arrangements. In 1994, as part of Menem’s neoliberal revolution, a sweeping set of reforms was introduced. These included increases in contribution rates, raising the age of retirement (to 65 for men and 60 for women), reducing the official replacement rate to around 60% and gradually increasing the minimum number of contributions from just 15 years to 30 (Rofman, 2004). At the same time, the system was restructured along the lines of the Three Pillar Model discussed in Chapter Three. Workers were required to choose between a government-funded scheme or to join privately managed individual savings plans. By 2006, around 80% of formal sector workers had been enrolled into the new private plans.6

Following the economic crisis of 2001, there was a re-evaluation of the 1994 pension reform. Increases to the retirement age and, in particular, the minimum years of contributions were leading to sharp falls in coverage. Between 1993 and 2003, the proportion of people aged 65 or more lacking a pension rose from 23 to 37% (Rofman, 2004). Coverage rates for poorer income groups, those most in need of state support, were particularly low.7 As the labour market had become more informalised, it was estimated that more than half of older people would lack a pension by 2025. Benefits had not kept pace with inflation, leading to effective replacement rates of around 40%. Although the private funds had generated good returns on their investments (averaging 11% a year between 1994 and 2003), there were mounting concerns about their exposure to sudden economic shocks. The loss of contributors to the government system meant that there were fewer funds for the state to cover its ongoing pension liabilities. The shortfall was met by substantial tax transfers, which accounted for 66% of pension fund income by 2003 (Roca and Bourquin, 2007). In (p.185) other words, contributory pension funds were increasingly subsidised by the taxpaying society as a whole. As the new government sought to demonstrate its traditional Peronist credentials, there was increasing pressure to develop a more effective welfare system for older people.

One option would have been to develop an extensive programme of social pensions, as has been done in several other developing countries. Argentina already had a limited programme of non-contributory pensions, paying out 115,000 benefits in 2003, covering around 4% of the population aged 60 and over (Bertranou and Bonari, 2005).8 Instead, the government decided to radically reform the contributory pension system. Previously, people who had not made the required 30 years of contributions needed to pay off all the outstanding contributions before they would be eligible for a benefit. This represented an insurmountable barrier for most older Argentines. From 2005, people with insufficient contributions were allowed a pension, with the value of their benefits reduced to cover the cost of the missing payments. In effect, these pensioners continue to contribute to their pension after retirement, although the rate of these contributions is unlikely to cover the funding shortfall.9 The 2005 reform had an immediate impact on the pension system, as many people with few or even no lifetime contributions were now entitled to a discounted pension. Between 2004 and 2007, the number of contributory pensions paid out rose from 3.3 to 4.3 million (Roca and Bourquin, 2007). It is now claimed that over 90% of older people in Argentina have access to either a contributory or a social pension, possibly the highest coverage in Latin America.10 The 2005 reform was accompanied by a series of other measures seeking to undo the policies of the 1990s. As the Argentina economy started to recover from the 2001 crisis, average benefit values were allowed to rise substantially. In 2007, the government enabled people affiliated to private funds to return to the government system. This led to a substantial fall in private fund membership, from around 12 to 10 million in a single year.

The impacts of population ageing on the financial status of Argentina’s pension system have been complex and indirect, and have changed over time. For most of the 20th century, the effects were minimal. Early retirement, contributor evasion, the misuse of early surpluses and unfeasibly high pensions (especially for more influential occupations) had a much larger and more direct impact on pension finance. Rather than a consequence of demographic change, the growing pension crisis was driven by a combination of political short-termism and institutional failure. In more recent years, it is arguable that population ageing has become a more significant factor. The main driver of extended pension (p.186) coverage and rising benefit values was no longer political management of the labour unions, but recognition that the 1994 reforms had failed to guarantee income security for a high proportion of older people. The economic welfare of older people had become a serious political issue in its own right: people aged 60 or more account for over a fifth of Argentina’s voting-age population. As population ageing continues, it is likely that the maintenance of an acceptable old-age safety net will remain a high political priority.

Health policy for older people

Since the 1990s, total health spending in Argentina has accounted for around 7% of GDP. In absolute terms, this represented US$524 per person each year in 2008, considerably higher than other countries in the region.11 In Chapter One we saw that population ageing does not inevitably lead to sharp rises in health spending, and that its impact is sometimes exaggerated and oversimplified. Nevertheless, since Argentina has high health spending and an aged population structure, it is valid to assess the extent to which they are linked.

Ideally, the impact of population ageing on health spending would be assessed by identifying the share of total health spending devoted to older people and how this has changed over time. In practice, this is impossible for several reasons. As in most countries, health budget data are broken down into services and types of provider, but are rarely disaggregated into specific age groups of patients. Second, the health sector is highly fragmented and decentralised, with a wide diversity of providers and financing mechanisms. This impedes data capture and comparison. Third, the quality of budget data is very uneven, especially for the growing private health sector.

A second approach would be to compare the health needs of older people to the rest of the population and assess how they have changed over time. If these needs are substantially greater, then it might be concluded that older people account for a higher share of the health budget. Again, there are a number of problems with this method. First, it should not be assumed that there is a simple relationship between the health needs of different population groups and the amount of healthcare resources devoted to them. In most countries, richer groups usually receive a larger share of health spending, despite enjoying better health than the poor. Older people may face particular discrimination compared with younger age groups. Second, good comparative data on the health status of Argentina’s older population and other age groups are not available. General epidemiological data show that older (p.187) people have a similar health profile to that of developed countries, with relatively high prevalence of hypertension, heart disease, diabetes and osteoarthritis (Vassallo and Sellanes, 2000). Given the size of the older population and these high rates of chronic disease, it can be assumed that they account for a large share of demand for health services. Whether these demands are adequately met, is quite another matter. The rest of this section focuses on different parts of the health sector, analysing factors that have affected their expenditure and the extent to which they provide effective services.

All health systems are complex, but Argentina’s is particularly so. The health sector can be broken down into three broad areas: decentralised publicly funded services managed by the Ministry of Health, a separate set of union-run social insurance funds (numbering over 200) and privately financed healthcare. Argentina also has a health insurance fund that is exclusively dedicated to pensioners: PAMI.12 Table 7.8 shows the relative importance of these sectors, in terms of budget.

Table 7.8: Distribution of health spending by sector (%)



Ministry of Health



Union funds






Private insurance and other private payments



Sources: Vassallo and Sellanes (2000);Tiempo Pyme (2008)

At first sight, PAMI would appear to offer good value for money. Pensioners made up around 10% of the population in 1997, and PAMI represented 11% of health spending. By 2008, its share of the health budget had fallen sharply to 7%. In fact, PAMI has been widely criticised over the years and has come to be seen as one of Argentina’s most notoriously corrupt and inefficient state agencies (Bonvecchi et al, 1998; Redondo, 2004). By the mid-1990s, it emerged that PAMI had massive debts, which reached somewhere between US$2 billion and US$4 billion by 2000.13 As with the contributory pension system, PAMI’s financial crisis made a significant contribution to public sector debt and the country’s economic instability. It would therefore seem to provide further evidence of a link between population ageing and reduced economic performance. Yet, just as with pensions, the huge level resources devoured by PAMI were much more the result of failures of governance and institutional mismanagement.

(p.188) PAMI was first set up in 1971, possibly inspired by the creation of MEDICARE, the world’s first social health insurance scheme for older people, in the US six years earlier (Redondo, 2004). Creating PAMI made good political sense to a military government, which was seeking to placate labour unions. The scheme relieved the union-run health funds from the responsibility of providing care to members after they had retired. Although these union funds continued to receive the same levels of resourcing through compulsory worker contributions, levels of demand for their services fell sharply. Labour unions were able to divert the large funding surpluses to a range of other activities, ensuring their continued political influence.

PAMI is funded separately from the union funds, with compulsory contributions levied on wages and pension benefits. Since it is exclusively for pensioners, older people without a benefit are excluded. PAMI does not provide services directly; instead, it contracts them out to a wide range of private organisations. Despite being part of the national social security system, PAMI itself is not a state agency and theoretically has the same independent status as the union funds. During the 1970s and 1980s, the scheme grew rapidly in terms of both membership and financing. By 1994, it provided services for over three and a half million people (over 10% of the total population) and managed an annual budget of over US$2 billion (Lloyd-Sherlock, 2003). But PAMI was also massively in debt, with a US$400 million shortfall between income and expenditure by 1994. To cover this deficit, members’ contributions were topped up with substantial government funding. Despite these additional resources and several expensive (World Bank-funded) reform initiatives, PAMI’s debts continued to grow.

It is widely recognised that the major factor driving PAMI’s indebtedness was extreme administrative inefficiency. By 1983, it was employing 12,000 staff, a high proportion of whom were political appointments filling largely fictitious posts (Redondo, 2004). Despite several attempts to reduce staffing levels, these remained largely unchanged by 2001. More generally, PAMI has suffered from high levels of corruption. A labyrinthine system of contracts with service providers created opportunities for malpractice. One study identified 26 different categories of corruption in PAMI (Bonvecchi et al, 1998). As a non-state entity, it is shielded from public scrutiny, but it was heavily exposed to political influence. PAMI directors were usually political appointments, and they often mobilised PAMI’s resources to further their own political careers, offering a wide range of welfare services that were outside PAMI’s own remit.

(p.189) A substantial proportion of PAMI members were not older people, with around a quarter aged under 60 by 1998. In large part, this was because of early retirement. It also resulted from politically motivated decisions to extend PAMI entitlements to new groups, including military veterans and women with seven or more children. All children aged under 21 of PAMI members were entitled to use its services, accounting for around half a million people. By contrast, until 2005 a significant share of the older population was denied access to PAMI services, since they were not pensioners. As such, it would be misleading to view PAMI as essentially a health fund for older people.

The limited available research shows large gaps between the services PAMI purported to offer and actual delivery, in terms of both quality and quantity. The range of statutory services listed in PAMI’s own ‘Digest’ went well beyond those offered in most developed countries, yet spending per person was less than a 10th of MEDICARE’s (Lloyd-Sherlock, 2003). Third-party providers were mainly paid a fixed amount per member, which encouraged widespread under-servicing. A virtual absence of regulation and information management permitted very uneven levels of quality. For several months during 1998 and 2002, PAMI suspended all payments to service providers and for essential drugs. As a result, a significant proportion of PAMI members made no use of the system, preferring to pay privately (Redondo and Salzman, 2000). In other words, despite the huge resources it absorbed, PAMI did not provide effective health services for its membership.

Since 2002, PAMI has seen a new set of reforms and these appear to have been more successful. Contracting has been simplified, to avoid some of the more obvious forms of corruption and inefficiency, and the total workforce has been scaled down somewhat. While PAMI still has substantial accumulated debts to services providers, it has been able to generate a large financial surplus in its current account. The relative ease with which PAMI was able to slip back into surplus indicates the degree of inefficiency and corruption it had previously suffered. Whether this has been done at the expense of further downgrading health services for older people is less clear: there are few signs that PAMI has been able to develop a more systematic and transparent model of service delivery.

For those older people who can afford it, private health insurance has become increasingly popular over the past decade. Data on the private insurance sector are extremely limited and incomplete: by 2008, an official register of firms and insurance plans had yet to be established. Older Argentines face particular barriers accessing private health insurance. First, they are required to pay much higher premiums (p.190) than other age groups. A recent study of 40 plans found that people aged 72 paid more than double those aged 42 (Economy Ministry, Republic of Argentina, 2003). A separate survey reported that many private insurers refused cover for people aged over 60, and those that did would only accept new members with a clean bill of health. Premium levels varied from US$60 to US$419 a month, and the quality of care was highly variable (Lloyd-Sherlock, 2001b). In 2008 new legislation required that being aged 65 or more should not be sufficient grounds for denying membership of a plan, and that payments should not rise excessively with age (Cufré, 2008). Given the almost complete absence of regulation of the privately financed sector, little can be said about the range or quality of services on offer. There are media reports that some of the cheaper plans provide a very limited package. Even after the 2008 law, private insurance remains unaffordable for the great majority of older people.

The union funds and the Ministry of Health account for around half of Argentina’s total health spending (Table 7.8). In the case of the union funds, the creation of PAMI has meant that almost none of this funding is dedicated to older people. The union sector is extremely fragmented, notoriously inefficient and had also been subjected to a series of largely failed reforms. These health funds represent a major source of financial and political power to the labour unions and they have been able to resist structural changes (Lloyd-Sherlock, 2005).14 Reducing these inefficiencies could significantly reduce overall health spending in Argentina, regardless of population ageing.

Theoretically, the Ministry of Health is a provider of last resort for people who do not have cover for PAMI, private plans or the union funds. Provision is highly decentralised and it is not possible to collate systematic data on financing or the level of service offered to older people. It is generally assumed that the overall level of quality is below the other sectors’, and the few available studies suggest that the public healthcare infrastructure is poorly maintained and outdated, particularly beyond Buenos Aires (World Bank, 1997). The Ministry’s core budget has varied sharply over recent years, but this appears to be more a reflection of political priorities than underlying demographic trends.

To summarise, establishing any link between population ageing and expenditure is impossible even for individual health sectors, let alone for the healthcare system as a whole. Instead, it is clear that the main causes of high costs have been institutional rather than demographic. Argentina’s healthcare system is in very poor shape to meet the increased demand associated with population ageing, and this has meant that many older people continue to receive a poor service. More generally, (p.191) the healthcare system is widely criticised as suffering from a heavy bias towards expensive, specialist, curative services (Escudero, 2003). Much less attention has been paid to measures that can promote good health throughout life, including in old age. For example, Argentina continues to have a much higher smoking prevalence than in most developed countries, and government anti-smoking legislation has been halfhearted (Sebrie et al, 2005). It has been estimated that tobacco-related disease accounts for over 15% of Argentina’s total health budget. By developing a more efficient and better-prioritised healthcare system, Argentina could greatly improve the health of all age groups, young and old.

Long-term care needs

As well as pensions and healthcare provision, a third area where older people may consume significant amounts of resources is the provision of LTC. As discussed in Chapter Five, these care needs have tended to receive less attention than pensions and health, but they can be just as significant, in terms of both resourcing and their impact on older people’s quality of life. It is also important to bear in mind that many older people actively contribute to the care economy, by looking after young grandchildren, sick or disabled relatives and ageing spouses. Nevertheless, age-related illness, frailty and disability mean that increases in the proportion of older people, particularly the oldest old, are likely to increase demand for LTC. Drawing on survey data from Buenos Aires about older people’s health status and functioning, a recent study (Monteverde et al, 2008) assessed their overall degree of dependency in later life. It found that 22% of people aged 60 or more in 2001 experienced some form of dependency. Of these, the great majority experienced either ‘high’ or ‘severe’ levels of dependency. There was a clear gender gap, with older men experiencing less dependency (14%) than older women (25%). The study estimated the average number of years that people aged 60 could expect to experience dependency for during their remaining lifetimes: 5.5 years for women and 2.5 years for men.

Despite the high demand for services, it might be concluded that the direct costs of LTC in Argentina are relatively small, simply because the state provides very few services. The first charitable old-age home was established in Buenos Aires in 1857 and several mutual aid societies followed suit over the subsequent decades (Freysselinard et al, 2000). These continued to be the main source of institutional care until the 1970s, since only a handful of state-funded homes were established. (p.192) The creation of PAMI in 1971 was an important milestone in LTC provision. As well as managing health services, PAMI was charged with meeting the care needs of its members. It did this by contracting out to private care homes and through the establishment of a range of other services, most notably clubs and daycare centres for pensioners. During the 1990s, as PAMI’s deficits mounted, payments to care homes were mainly discontinued, forcing many out of business and leaving their residents in a highly vulnerable condition. In recent years, PAMI has sought to re-establish networks of care homes and to promote training programmes for paid carers. This has been supported by a government agency—the Dirección Nacional de la Tercera Edad—albeit it with a minimal budget. Given the lack of publicly available financial information for PAMI, it is not possible to accurately assess the extent of public expenditure on care services, but it is a very small fraction of the pension and healthcare budgets.

Due to the lack of government involvement, only a very small proportion of people aged 60 or more (2% in 2001) were reported as residents in old-age homes, almost all of which operate on a private for-profit basis (Redondo and Lloyd-Sherlock, 2009). The great majority of older people are left to rely on their families for support: it has been estimated that over 80% of dependent older people receive care on an unpaid basis from a relative (Freysselinard et al, 2000). This informalisation of the care economy has important implications for the quality of care received, for the person providing the care and for the costs of caring.

Leaving care to family members is not costless, since these relatives lose potential earnings from other, salaried forms of employment. Monteverde et al (2008) estimated that the real average cost of providing family care for an older woman would be over US$65,000 during the course of her lifetime.15 Increasing the proportion of care provided by residential homes substantially reduced the overall care costs, due to economies of scale and other effects. From this it might be concluded that the real cost of informal caring is very high indeed. However, this is based on the assumption that the salaried labour market has the capacity to productively absorb these additional workers, which may well not be the case. As in other countries, it is female relatives (including older ones) who provide the bulk of unpaid care (Esquivel, 2008). Caring for an older relative restricts the potential amount of time women are able to make pension contributions, reducing their own welfare entitlements in old age.

The effects of the care economy on older people are less easy to assess, as little reliable information exists. Most older people express a (p.193) strong preference to remain in their own homes, and to be cared for by their own relatives. However, low levels of fertility and changing social trends mean that a growing share of older people live alone. According to the 2001 Census, 19% of people aged 65 and over lived alone, and a further 27% lived in nuclear households without children. For people aged 80 or more, the proportion living alone is even higher. Although some of these people may choose to live alone, the data suggest that many struggle to access informal care when they need it. Nor should it be assumed that living with a younger relative is a guarantee of informal support. Several studies reveal much more complex patterns of family dynamics, and in some settings living with children may be as much a source of vulnerability as of potential support (Lloyd-Sherlock and Locke, 2008). There are growing anecdotal reports of family abuse and abandonment of older people. A recent survey of older people in residential care homes found that a significant proportion had been admitted by relatives against their will (Redondo and Lloyd-Sherlock, 2009). Regulation of care homes is lax and there are indications that the quality of services they offer is highly variable (Redondo and Lloyd-Sherlock, 2009). On a more positive note, the extensive network of day centres established by PAMI remains largely intact. These centres provide an important source of support and social activities for older people with high levels of functioning, and could form the basis for a more concerted programme of supporting domiciliary care.

Overview of the economic impact of population ageing

Argentina has seen decades of poor economic performance, it has a large population of older people (most of whom are no longer in paid work) and spends heavily on pension provision and healthcare. At first sight, the links between population ageing and reduced economic dynamism would appear quite evident. The previous discussion suggests otherwise. Argentina’s relative decline began in the 1930s, well before it contained large numbers of older people. High levels of spending on pensions and healthcare may have contributed to this decline, especially from the 1960s when large deficits emerged. However, the main causes of high spending were institutional and political in nature, rather than demographic. The impact of ageing on economic dependency must be offset against falling numbers of children and the economic benefits of reduced fertility. Any effects of ageing on savings rates were swamped by decades of high inflation, which acted as a major disincentive to hold onto money. Moreover, the real opportunity costs of reduced (p.194) economic activity in later life and of the diversion of informal carers from paid work depend on the capacity of the labour market to absorb these extra workers productively. High rates of unemployment and underemployment suggest that this capacity should not be taken for granted. Arguably, slower fertility transition and more gradual population ageing could have increased the labour supply to the extent that worker costs were pushed down, thus boosting growth and the supply of jobs. This, however, is a highly speculative argument, and it ignores the costs of larger cohorts of young children.

Population ageing may have had little to do with Argentina’s long-run decline, but its economic significance has increased in recent decades. Had Argentina developed more effective pension and health policies in the past, it would have been in a strong position to face the challenges of ageing today. Instead, problems of poor governance and inefficiency continue to bedevil many areas of social policy, especially in healthcare. The substantial amounts of public resources devoted to these programmes crowd out the possibility of developing a more systematic set of policies supporting the care economy. Increasingly, older people are seeking their health and care needs from a poorly regulated private sector. The recent upgrading of pension policy has boosted the income security of the older population, but questions remain about its long-term sustainability.

As Argentina’s older population has grown, it might be expected that it would become more politically influential, especially since the return of democratic rule in the 1980s. Many of today’s cohort of older people have past experiences of political activism and most are literate. During the military governments of the late 1970s and early 1980s, a group of older women ran a high-profile human rights campaign, with daily demonstrations outside government buildings. In the 1990s, a small but vocal pensioner lobby organised marches and protests against Menem’s pension reforms. Despite these precedents, a substantial political movement representing older people’s (or even pensioners’) interests has not emerged in Argentina. Pension policy is a very prominent public issue, but the lines of the debate are mainly drawn between traditional Peronists and opposing ideologies, rather than between young and old. Political parties are acutely aware of the weight of older voters and this will have important effects on future policy directions, especially for pensions.

Current cohorts of older people have lived through decades of political turbulence and growing economic uncertainty. Many suffered from the contraction of the pension system during the 1990s, in terms of both coverage and benefit values. The recent pension upgrading will (p.195) have brought relief and a secure income to many, but this alone does not guarantee a good quality of life in old age. The following three life histories give a flavour of what it has been like to grow older in Argentina. As in the other country chapters in this book, they do not intend to provide a representative view of ageing experiences—these are too complex and too diverse to be captured in a small number of interviews. What they do offer is three very different sets of experiences, taken from three different socioeconomic strata. They provide striking contrasts in terms of access to pensions and other public resources, as well as patterns of family relationships and care. Each informant’s life was profoundly shaped by wider national events (such as the rise and fall of the industrial sector and political transitions), but these effects were very different. A common theme that emerges is a growing fear of violence and a difficulty in making sense of the bewildering pace of national change.

Three lives16


Anastacio is 83 years old. He was born in the province of Santiago del Estero, about 600 miles to the northwest of Buenos Aires, one of 14 brothers and sisters. He worked on the land from the age of 14 and came to Buenos Aires in search of work when he was 18 (1943). He had no difficulty finding a factory job, and continued to work there until he was 59 (1978): “There was so much work around in the old days. I left my job in one factory, and two blocks away I found another place that was taking people on.” Anastacio married a woman from Santiago when he was 28, but they separated shortly after the death of their young child. He later remarried and had a daughter

Anastacio was allowed to retire one year before the usual age, as he had developed bronchial problems at work. Initially, he was not given a full pension, and he had to hire a lawyer to help resolve his claim. Shortly after Anastacio retired, his factory and most of the other ones in his neighbourhood were shut down. At first, he continued work in a small repair workshop but he found this was too much for him. His income consists of a basic pension and the pension of his recently deceased wife (who worked as a cook). Although he does not live in a shanty town or slum, he feels that his neighbourhood has become much less secure in recent years and does not go out at all after dark: “There were 2,000 people working in my factory. Now, there are so (p.196) many poor people living round here and lots of stealing. It wasn’t like that before. Now there just aren’t any jobs to be had.”

He lives with a daughter, her husband and two young grandchildren, and says that they look after him well: “I don’t have any complaints about my life these days.” Anastacio’s health has deteriorated in recent years. Among other problems, he is deaf and has developed Parkinson’s disease. He has been trying to obtain a hearing aid through PAMI for the past three years, without success. Rather than rely on PAMI, he mainly sees private doctors and finds these difficult to afford.

Anastacio feels that Perón did much to improve the lives of people like him, but that his legacy was later undermined, especially during the 1980s and 1990s: “As far as I’m concerned, Peronism was the best thing that ever happened in Argentina. They respected us workers…. Those guys who say they are Peronists nowadays are just nothing”.


Susanna is 79 years old and was born in a Pampas village about 60 miles from Buenos Aires. Her father was an Italian migrant, who set up a successful family business in the village. After finishing school, aged 17, she trained as a school teacher, qualifying a year later (1947). Initially, she was not able to get a teaching position, as it was necessary to affiliate to the Peronist Party and she was not prepared to do this. Instead, she worked in her father’s office, making contributions to the commercial pension fund.

Following a military coup (1955), Susanna was able to start work as a teacher: “The officers were almost all married to schoolteachers who were out of work. So they started to give posts to the older women first. That’s how I got my chance.” She continued working until she was 47 (1976), when she was allowed to retire on a full pension, worth 82% of her previous wage: “When the military came back into power, many of their wives were still teachers. So they allowed people to retire young, so their own wives would benefit. That worked out well for me, too.” Despite this, she feels she was cheated out of her commercial pension entitlement: “The pension fund had told me not to worry, that when I retired they would take into account the seven years I had contributed. But when I stopped working, they just refused to.”

Susanna then moved to Buenos Aires, to accompany her four children who were studying at university there. She was able to buy a house in one of the city’s most prestigious neighbourhoods, mainly due to money she inherited from her father. All of her children have done very well in life and one now lives in the US. Susanna’s husband died (p.197) of lung cancer when she was 56 and she now lives alone. She says that this is her preference and that she sees her family on a daily basis.

Susanna’s children had advance warning of economic crises, which enabled her to withdraw her money from banks and protect her savings: “We were saved twice. Once in the 1970s, because my children worked for IBM and they know about the shock policy in advance…. Then [in 2001] I had a daughter who worked in the Banco Francés. She started to see how people were panicking, and told me to get my money out while I still could.” Susanna has a number of health problems, including back pain and heart disease. She prefers to pay for an expensive private health plan rather than rely on PAMI or her old union fund: “PAMI is just a joke. They do all those adverts and have numbers you can ring, but I’ve never been able to get through.” Susanna remains very active and is on the committee of her local pensioners’ association. She says she is content with her life, but is saddened by the state of the country: “We’ve lost so many of our traditions; our respect and our courtesy…. I always thought that this was going to become an organised country, but now there’s so much instability.”


Ana is 80 years old and was born in Goya, about 500 miles north of Buenos Aires, one of 15 brothers and sisters. She now lives in one of Buenos Aires’ most notorious and dangerous slum districts. She attended school until she was eight years old, when her mother took her to work as a nanny for a family in Paraguay. She was not allowed to continue in school and was badly treated by the family. Aged 13 (1939), Ana escaped and came to work as a domestic servant in Buenos Aires: “I didn’t know anything. I didn’t even speak Spanish, only Guaraní. These days nobody speaks Guaraní anymore—I’ve completely forgotten it.” She stayed with the same family until she was 19, when she married and had her first child. Her husband, “an excellent man”, had a good job, working for the Eva Perón Foundation and then for the post office. Ana had five children, and when she was 30 (1956) she started to work in a factory: “It’s gone now. Those days there were strikes all the time. It was really frightening. Sometimes people fought each other with knives. I just wanted to get on with the job, but sometimes there were people at the gate who wouldn’t let you past. My husband didn’t like me being there.”

Ana went back to work as a hospital cleaner, but they found it hard to make ends meet, so were forced to live in the slum. In 1976, they were forced to move again after the slum was bulldozed by the new (p.198) military government, but returned to build a new home there a few years later. Ana’s husband died of a heart attack in 1984. She now lives with a daughter who is divorced and suffers from epilepsy, two grandchildren and a son with serious mental health problems: “He doesn’t work. He just sleeps and says crazy things. When he has a fit and doesn’t take his pills, he has to spend weeks in bed. I have to look after him like a baby.” The son is sometimes violent and Ana is afraid to leave him alone in the house.

The family lives off Ana’s widow’s pension and her daughter’s disability benefit, and by selling crafts in a local market. She has substantial debts on money that she borrowed using her pension as a guarantee. Ana says she is in good health, but does not make regular health visits to health clinics. She has been assaulted several times and would like to move somewhere else: “They’ve attacked me twice recently. Once when I was collecting my pension they threatened me with a gun and took my purse and everything. I know who they are, their names even. Then they broke down our front door and took everything we had in the house. One of them is a neighbour’s son, but I was too frightened to go to the police.” Ana is very concerned about how her family will cope after her death: “It’s a struggle. Life is very hard for women who are trying to support their families on their own. Even though I’m 80, if they offered me a job I’d take it straight away. I won’t let things beat me”.