Prodavinci evidenced how the Venezuelan State confiscated the savings of workers. We collected 20 years of data on salaries of teachers, university professors, and employees who earn minimum wage to calculate how much has fallen the value of the pension and savings available to Venezuelans during their retirement. Five million people depend on this income to survive, and the analyzed data allows us to show the vulnerability of older persons in Venezuela. The value of the pension in 2000 was the equivalent of $ 311.06. Twenty years later, it’s the equivalent of $ 0.94 (a drop of 99.70%).
Prodavinci is the only Venezuelan media that has demonstrated the loss of the value of retirement in the last twenty years. In our research, we found that the value of the pension in 2000 was 330 times higher than in September 2020. Venezuelan workers who retired in 2020 contributed up to 57 times more to Social Security than they will receive in pensions throughout their old age. A Venezuelan university professor contributed $16,426 to Social Security in 20 years of work, but the system will pay him back just $ 281 over the next 25 years. He would need to live 1,459 years to get his savings back.
Older persons are pushed into poverty by not having enough resources to pay for food and medicine. The pension used to be enough to cover an average of 92% of the food basket. In the last 20 years, the average coverage dropped to 76%. For the pension to cover the value of the food basket, the State must have to transfer to all beneficiaries at least an additional 8,396 million dollars during the last 20 years. If the pension had maintained the value of the food basket, 55.40% of the people of retirement age (more than one million) would have come out of poverty.
The project won a Special Mention in the National Journalism Contest of IPYS Venezuela (2021), and the authors were invited to the Latin American Conference on Investigative Journalism. The Permanent Forum of Social Security of the postgraduate course in Social Security of the Central University of Venezuela invited Prodavinci to present the research findings in a forum broadcasted on YouTube. Due to the content of social interest, HumVenezuela -an information platform created by civil society- and Mediosur -an independent media initiative- shared the project.
We gathered salary tabulators for public education teachers, full-time university professors, and public employees’ salaries to compare the value of retirement between 2000 and 2020. We took data from the Ministry of Education, notes from the Ministry of Communication and Information, and documents provided by the Venezuelan Federation of Teachers. We found data from different years in individual studies of university professors, reports from the Human Resources Directorate of the Central University of Venezuela, and the Association of Professors of the University of Zulia. We consulted Official Gazettes for each month between 2000 and 2020 to carry out the time series on the minimum wage. The information was organized in a database in Excel for later analysis.
For this project, the concept of retirement value is the addition of pensions and social benefits. However, the most relevant indicator is the value of the pensions because they depend entirely on the state system. We also used macroeconomic indicators for calculations, for example, inflation and food basket. To facilitate the comparison of the data, especially in a country where the value of the currency and other economic indicators changes continuously, Prodavinci calculated the value of pensions in United States dollars from the minimum wage and its conversion with the exchange rate between bolivars and dollars.
To fully catch the collapse of the Venezuelan social security system, it was necessary to establish projections to understand the value of retirement for those who today are beginning to be retired workers. We applied financial mathematical calculations under the parameters indicated by Venezuelan social security laws. As part of our strategy, we asked experts to accompany us in the data processing and analysis. Our methods and strengths as a team are based on alliances with members of the academy and with specialists in specific areas.
What was the hardest part of this project?
Due to official opacity, there is no public information available in Venezuela about social security or poverty in old age. The data we needed to start was scattered in individual studies or reports from universities’ human resources departments, and not all used the same method. So first, Prodavinci had to gather the data in one place. The team invested at least 6 months to assemble 20 years of salaries from each case study (teachers, university professors, and public employees). It was also necessary to confirm all the data, comparing it with different resources.
Having overcome the challenge of building a strong database, we are faced two challenges. The first was applied financial methods to project the retirement value for the workers who ceased their activities in 2020. For this reason, we sought advice from economists and financial experts. Their help was vital before, during, and after the investigation, through constant communication and review of the calculations.
The second challenge was to deal with the polarization of the information about inflation in Venezuela: the National Assembly has different information from that handled by the Central Bank. At that time, they’re politically confronted. Due to the enormous difference between the results, we decided to show the data from both institutions. That allows perceiving the complexity of this problem in the context of the Venezuelan crisis.
What can others learn from this project?
Other journalists can use this data explainer as an example to conduct investigations into the mismanagement of public funds, especially in cases not necessarily linked to corruption or not aimed at pointing out individual culprits. This project is an example of how the journalist takes advantage of the data to show that a particularly vulnerable group is affected by the misuse of the funds that the State should allocate to guarantee them a better life.
This journalistic work also provides possibilities to explore the application of mathematical methods to make projections that are useful for approaching a story.
This project is helpful to demonstrate the results of alliances between experts and journalists. It shows that constant advice and communication with sources enhances the possibility of obtaining data with a rigorous and verified methodology. As journalists, we can rely on science and economic principles, but it is gainful to incorporate the advice of experts into the research, writing, and editing process.