Élite opinion on retirement pensions

This article discusses some of the findings of a European study of the opinions of influential people in welfare. It is divided into five main sections. The first section discusses the aims and the methodology of the study; the second section looks at the issues in pensions as seen by the respondents in the various countries; the third section examines the proposed solutions; the fourth section tries to establish whether political ideology makes a difference in the way respondents perceive the issues and solutions; and the fifth section is the conclusion.     

Working life and retirement pensions in Spain: The simulated impact of a parametric reform

This article aims to offer an ex ante evaluation of the impact of a parametric reform of the Spanish pension system that would involve increasing the reference period used to calculate benefits, an approach proposed many times by various actors in the socio‐economic field. Such gradual change may be categorized as a non‐structural reform of the pension system. This contrasts with reforms of a structural nature that have been very popular in Latin America and elsewhere, involving the creation of defined contribution individual account schemes. As regards the parametric reform proposed in this article, the main findings indicate that it would have a small but negative impact on pension income for pensioners and would reduce income distribution.     

The Spanish public retirement pensions system: Principal challenges and recent developments

This paper first describes the basic characteristics of the Spanish system of retirement pensions, before addressing its major challenges in the future and the principal solutions proposed. For this purpose, many of the works on social security published in Spain over the past years have been reviewed to provide a recent overview of technical discussions on this subject. Finally, the main reforms undertaken by the government since 1995 are described in some detail and assessed.     

Financing retirement pensions: Pay-as-you-go and funded systems in the European Union

The techniques used to finance retirement pensions in the European Union are extremely varied, as are schemes'institutional frameworks. The standard distinction between pay-as-you-go and funded systems obscures the fact that there are four main types of schemes, each with very distinct methods of regulation and conditions of long-term viability. An analysis of the current procedures reveals the extent to which the schemes'ways of operating differ, and points to considerable variations in the way the social actors participate in the process of regulation. The adaptation of pension systems to new realities is dependent on factors which go far beyond a simple choice between two basic methods of financing.     

Social needs and the roles of governments and markets: The case of retirement pensions

The present paper examines the role of the State and the market in meeting social needs, with particular emphasis on retirement pensions. The argument proposed is based primarily on an analysis of recently observed ideological developments as well as of the results of various empirical studies conducted on the topic. A review of several theories and current debates on the issue constitutes the introductory part of the analysis. This is followed by a discussion of retirement pensions and the shortcomings of governments in this domain and by a review of the evidence obtained on the interaction between retirement pensions, investment and growth. Data and calculations relating to several developed and developing countries are presented as an illustration of the State's responsibility for social needs. The conclusion presents some reflections based on empirical evidence and a synthesis of insights obtained in this study.     

Restructuring Australian retirement incomes: Implications of changing work and retirement patterns

Work and retirement patterns among older Australian women and men are changing. In this paper, the interactions between these patterns and social security policies are contrasted with the desirable direction of work and retirement later in life. The change in Australia's retirement incomes system towards the "three pillar model" described by the World Bank poses particular issues for late life employment and retirement, especially for older women.     

Class-competent social work: a preliminary definition

The article seeks to present a theoretical framework for defining class-competence in social work practice. Social work has made significant progress in enhancing practice competence with respect to contextual factors that transcend social class such as gender, culture, race and ethnicity. But this positive development in overcoming the rigid view, which framed class as the sole explanation of diversity, has obscured the current impact of social class differences in social work practice. This article takes a critical look at the historical approach of the profession to class issues, extends the boundaries of the social class concept beyond its narrow economic dimensions, discusses the relevance of addressing class issues in light of current challenges in social work practice and, lastly, proposes a preliminary definition of class-competent social work practice.     

Principles of financing social security pensions

This paper aims to provide a framework for debate on the financing of social security pensions. It begins with some basic principles related to the economics of financing social security. It then focuses on the prominent subtopics that arise in connection with financing discussions and how these subtopics relate to each other. The first section discusses the basic principles: (1) the rationale for government intervention in the market for retirement income, (2) the factors that combine to determine the social costs of supporting pensioners, (3) the mechanisms used to deliver the support to pensioners and allocate the costs and (4) the important role played by political and cultural influences in determining the actual economic impact of a particular institution. The next section focuses on ways that societies can alter the burden of supporting retired people. These include changes in relative incomes, in economic growth rates, in labour supply rates and in administrative cost. A third section concentrates on the distribution of benefits and costs among members of a particular birth cohort as well as between and among cohorts. This section also explores the relationship between programme structure and the extent of programme coverage. The fourth section discusses the challenge of assuring that the system remains economically and politically viable in the long run. It notes in particular the role that political traditions play in influencing how programmes structured in particular ways develop. The paper closes with a summary and some concluding observations.     

Extending access to contributory pensions: The case of Uruguay

Since the 1980s, many Latin American countries have tightened access to contributory pensions, with financial sustainability being a main concern. Studies suggest that a sizable share of contributors would not be able to comply with stricter access conditions, since observed contribution densities were low. While most Latin American countries lack complete work history records, the observed density of contributions offered strong evidence of short contribution histories, in particular for low‐income workers and women. In the last decade these facts drove a new wave of reforms, in the form of less demanding eligibility requirements to access pensions and the need for a gender perspective. Uruguay took part in both processes, increasing vesting period conditions in 1996, then lowering them and granting childcare credits in 2008. In this article, we analyse the effects that less strict eligibility requirements would have on pension entitlements in Uruguay, estimating complete contribution histories using administrative records. Work history records have been kept since April 1996 only, meaning there are still no complete work histories. The study finds that pension rights would increase, in particular for women. The main effect would be driven by the lower contribution requirement. In addition, childcare credits would further reduce the gender gap in terms of access to benefits. The case of Uruguay is relevant in the regional context, as most Latin American countries are ageing rapidly and can learn from the Uruguayan experience, a country with vital statistics closer to those of developed countries. Also, recent reforms in the region show shared concerns on pension rights and the gender gap.     

Financing the statutory pensions insurance scheme in a united Germany

This article outlines the development of the predominant scheme of old-age protection in Germany (the statutory pensions insurance scheme) within the framework of the process of unifying the two post-war German states. The systems of old-age protection in West and East Germany had evolved very differently after the Second World War, so that a major transformation was needed. The various stages of bringing the schemes together are described, including the conversion of pensions in the German Democratic Republic when the Deutschmark was introduced on 1 July 1990, the raising of pensions, and the considerable further adjustments that took place later. Finally, the process of applying West German pensions legislation to East Germany is described. This legislation resulted from a Pensions Reform Act which was adopted on 9 November 1989 with the purpose of adapting the system of old-age protection to changing structural conditions affecting the composition of the population, the economy and society as a whole. The article is completed by a look at the evolution of the financial requirements for pensions insurance over the medium and long term.     

Micro‐pensions in India: Issues and challenges

This article aims to fill a gap in the social security literature on India by examining the role of micro‐pensions. The analysis suggests that because of the heterogeneity of the target population, micro‐pension products — with microfinance institutions (MFIs) as the main, but not only sponsors — should be voluntary and portable and permit experimentation in their design and in the delivery of services. Accordingly, decentralized micro‐pension schemes that operate within an appropriate regulatory framework and according to sound governance practices are deemed more fitting for the Indian context than centralized schemes with limited flexibility. The article discusses two case studies of recently‐initiated micro‐pension schemes in India, which reveal the need for rigorous analytical research on the micro‐pension sector, particularly concerning the structuring of pay‐out options and innovative delivery mechanisms. The article concludes that micro‐pensions have the potential to be one of the most useful components in India's multi‐tiered social security system, and should be encouraged.     

Projected spending on pensions in Spain: A viability analysis

The viability of pay-as-you-go retirement pension schemes, such as that of Spain, remains a subject of ongoing debate. In this article we shall attempt to demonstrate that demography is the key variable that determines a system's viability. Analysis of several predictive studies conducted in the country shows that many of their predictions have been erroneous and their findings overpessimistic. This is because their forecasts were based on projections for the resident population, and overlooked the magnitude of the recent phenomenon of immigration. If the current influx of migrants continues, the problem of viability can be resolved.     

The provision of complementary pensions: Objectives, forms and constraints

In all former centrally planned economies, the question of how to restructure old-age income provisions and open the way to non-governmental, complementary pension schemes is being posed. This paper deals with four main areas of that problem. First, the various objectives of public and complementary schemes are discussed. The paper argues that without a broad consensus among the major interested parties there is a considerable danger that envisaged objectives will not be achieved. The second section reviews the main forms of complementary pension scheme and discusses the central characteristics of occupational and personal schemes. The third section addresses two critical policy areas: the kind of regulations that may be required in order to enforce the social and economic objectives; and the likely social and economic implications. On the basis of experience in OECD countries and the specific situation in countries in transition, the final section offers some tentative conclusions for Czechoslovakia, the main one being that during the initial phase of economic transition preference should be given to a simple defined contribution plan. Such a complementary scheme would be consistent with the lack of developed financial markets and the privatization plan of the government and require neither a great number of highly trained accountants and actuaries nor the comprehensive set of regulations a defined benefit plan is likely to dictate.     

Australia's retirement income revolution: a Finnish system "down-under"

Most advanced industrial societies are confronting serious economic recession, and governments are seeking ways to stimulate economic growth and reduce government expenditure. For many countries these problems are compounded by aging populations and demographic changes. There are fewer people in the workforce, and more people in older age groups live longer and have increased expectations for retirement lifestyles. The result has been that many governments are radically transforming their systems of retirement income provision, often causing political, economic and social upheaval and widespread public anxiety. Australia is one country in which there have been huge changes in the retirement income system in the past 5 years. The system has been substantially privatized, and future retirement income will come from statutorily enforced earnings-related individual savings accumulated in decentralized private funds. Australia's new retirement income regime bears extraordinary similarities to the Finnish system of employment-related pensions, yet there was no reference to the Finnish system in the evolution of the new Australian system. There are lessons for Australia and for other countries in the long and successful operation of the Finnish pension system. This article first examines Australia's retirement income system, recent government policy changes and likely implications of these retirement policy changes for the future of Australia's traditional welfare state. Cross-national comparisons of the retirement income regimes in Finland and Australia, identifying international best practice in each country, comprise the second half of the article. Such comparisons will be of interest to policy-makers seeking new policy directions.     

Universal age pensions in developing countries: The example of Mauritius

Mauritius, a small developing country located in the Indian Ocean east of Madagascar, has provided older residents with non‐contributory age pensions since 1950. The scheme became universal in 1958. Mild income tests were reintroduced in 1965 and again in 2004. Targeting proved to be unpopular, and universality each time was restored. Government added a mandatory, contributory tier in 1978 that does not replace the flat, non‐contributory pension. Instead, it promises participants (approximately half the labour force) an income‐related benefit to top up the universal pension. The author examines Mauritius's long experience, drawing lessons from it for other developing countries.     

Social pensions and policy learning: The case of southern Africa

In the last decade and particularly since the publication of the Millennium Development Goals, social pensions have captured the interest of those concerned with the well-being of older people across that large part of the world where formal, contributions-financed, old-age benefit systems cover only a minority of the population. International organizations have turned their attention to such schemes and some see them as having a valuable role to play. However, information about what they are and how they work, and about their efficacy in meeting the objectives set for them, is still limited. Learning has been taking place not only in the international organizations but also in the region where they are most prominent – southern Africa. Such learning should be encouraged and the International Social Security Association has a part to play in this learning process.     

Reforming pensions: Myths, truths, and policy choices

This paper discusses the building blocks of pension reform in the light of economic theory, and their application to different types of economy. The opening section sets out the simple economics of pensions. The second section discusses a series of myths which have proved remarkably persistent. Building on this analysis, the latter part of the paper sets out the foundations of effective pensions policy. The third section discusses the prerequisites which any pension reform must respect, i.e. those things which policy advisers can — and should — assert authoritatively. The fourth section turns to the range of choices facing policymakers, drawing on the very different arrangements in different countries. The main conclusions are threefold: (1) The key variable is effective government. (2) From an economic perspective, the difference between pay-as-you-go and funding is second order. (3) The range of potential choice over pension design is wide. One size does not fit all.