In an interview, the head of Dominican Republic's Pensions Superintendency (SIPEN), Francisco A. Torres, set out the main constraints on pension adequacy in the Dominican pension system, pointing to limited saving and discontinuous contribution histories driven by labour-market informality. He also clarified how retirement eligibility, contribution density and the minimum guaranteed pension operate, and highlighted the system’s long-run real investment returns. Under the law, retirement is permitted from age 60, but Torres said a “good pension” typically requires 30 years of contributions (360 payments), which few workers achieve because, on average, they spend 40% of their working lives in formal employment and 60% in informality. He noted that total pension contributions are close to 10% of salary (7% employer, 3% worker) versus an 18% average in OECD countries. Torres highlighted a lesser-known feature, the minimum guaranteed pension: citizens with 25 years of contributions (300 payments) are entitled to a lifelong minimum pension that is adjusted for inflation every two years. Actuarial studies endorsed by the World Bank and the International Labour Organization project that 60% of the population would not reach this minimum without consistent monthly saving; he added that for 30% of the population the minimum would represent a 100% replacement rate, and for 50% it would imply a 70% replacement rate. On investment performance, he said the system has achieved real returns of 5% to 6% over the past two decades, with more than half of accumulated individual-account balances coming from returns rather than contributions. Torres encouraged the public to use SIPEN’s educational and official online platforms to better understand system benefits and operation.
Pensions Superintendency (SIPEN) 2025-11-18
Dominican Republic's Pensions Superintendency calls for higher retirement saving and explains minimum guaranteed pension eligibility
Francisco A. Torres, head of the Dominican Republic's Pensions Superintendency (SIPEN), highlighted pension adequacy constraints due to limited saving and labour-market informality. He explained retirement eligibility, contribution density, and the minimum guaranteed pension, noting 60% of the population may not reach the minimum without consistent saving. Torres also reported real investment returns of 5% to 6% over two decades, with significant account balances derived from returns.