Voluntary Savings Schemes to Protect Informal Workers in Jordan

This paper proposes a framework of voluntary savings schemes (VSS) in Jordan that can complement the current formal sector arrangements to better protect informal workers against economic shocks, unemployment, old age, or disability. As benefits of traditional mandatory pension systems worldwide have been cut substantially since the 1990s, voluntary defined contribution schemes are increasingly trying to fill the gap. In many countries, including in low-income countries, special voluntary savings schemes have been introduced to protect informal workers. Blending the knowledge from best practices internationally with the cluster methodology developed specifically for Jordan, the paper provides an overview of the current system of social security in Jordan and presents policy options to lower informality, extend social protection coverage, and provide more adequate protection to workers