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Abstract. The paper examines the intergenerational impact of the Spanish public pension system after the 1997 Pension Reform Act. Within a Generational Accounting framework, we find that the new legal setting could leave future generations with liabilities as high as 176% of 1996 GDP. Hence, we analyse the impact of alternative reforms. Holding the pay-as-you-go setting, a further improvement to tax-benefit linkage in line with the Toledo Agreement proposals is shown to yield an intergenerationally more balanced outcome, than an increase in the retirement age or an expansion of public subsidies financed through indirect taxes. Finally, a move toward a partially funded pension system which restores the intergenerational balance is simulated.
