Elephants on the move. Patterns of public pension reform in OECD countries

2000 ◽  
Vol 8 (3) ◽  
pp. 353-378 ◽  
Author(s):  
Karl Hinrichs
Keyword(s):  
Old Age ◽  
Social Insurance ◽  
Pension Reform ◽  
Universal Coverage ◽  
Oecd Countries ◽  
Public Pension ◽  
Occupational Pension ◽  
Old Age Security ◽  
Pension Schemes ◽  
The 1960S

Among OECD countries there are two clusters of old-age security systems: (1) ‘Social insurance’ countries had, by the end of the 1960s, fashioned the core of old-age security as public, contributory, earnings-related and unfunded insurance schemes; (2) a diverse collection of countries that, after 1970, topped up their basic pension arrangements with funded occupational pension schemes with (almost) universal coverage. ‘Social insurance’ countries, on which this essay focuses, reveal at least six common trends in pension reform, all about improving the financial sustainability of public schemes. Although the repertoire of incremental adjustment strategies is quite limited, policy changes since the early 1980s have not led to a clear convergence among ‘social insurance’ countries (or across the two clusters). Their original diversity has been somewhat diminished, but it has for the most part merely taken a different form. Public pension reforms regularly harmed (future) beneficiaries. Nevertheless, most reforms were actually based on broad political consensus. The success of attempts to introduce retrenchment policies depends on prior negotiation with – and support obtained from – collective actors above and beyond a simple parliamentary majority. This peculiar prerequisite ensures success in the sense of a sustained implementation of the measures taken and of actual improvement in public trust in ‘reliable’ pension schemes.

Transformations in economic security during old age in Korea: the implications for public-pension reform

2006 ◽  
Vol 26 (4) ◽  
pp. 549-565 ◽  
Author(s):  
YOUNG-JUN CHOI
Keyword(s):  
Old Age ◽  
Social Protection ◽  
Pension Reform ◽  
Economic Security ◽  
Public Pension ◽  
Pension Scheme ◽  
Ageing Population ◽  
Social Expenditure ◽  
South Korean ◽  
Old Age Security

The South Korean National Pension scheme was instituted in 1988 and now covers all private-sector employees and the self-employed. Since the financial crisis of 1997, however, it has become controversial and is under considerable pressure, not least because of the perceived financial implications of the country's rapidly ageing population. Predictions of financial shortfalls or ‘unsustainability’ have prompted calls for severe ‘downsizing’ of the scheme. The debate on the reform of the scheme has been dominated by the need to respond to demographic change in ways that assist the national economy, invariably by reducing social expenditure. The debate, however, has given little attention to the social or welfare functions of the pension scheme, though the material insecurity of older people has been exacerbated by major changes in the labour market and the family. This paper details recent socio-demographic changes in Korea and discusses their implications for old-age security and pension reform. It argues that public-pension schemes should be developed to strengthen social protection against the insecurities of old-age, that intra-generational redistribution should be at the core of the reformed arrangements, and that the introduction of a comprehensive non-contributory pension scheme should be seriously considered.

Towards a New Role for Occupational Pensions in Continental Europe: Elements and Techniques of Solidarity Used within Funded Occupational Pension Schemes

2002 ◽  
Vol 4 (1) ◽  
pp. 25-53 ◽  
Author(s):  
Yves Stevens ◽  
Gerhard Gieselink ◽  
Bea Van Buggenhout
Keyword(s):  
European Society ◽  
Social Protection ◽  
Pension Reform ◽  
Occupational Pension ◽  
Anglo Saxon ◽  
Private Pensions ◽  
Occupational Pensions ◽  
Pension Schemes ◽  
Financial Issues

‘At first glance, it may seem incongruous to talk of private pensions in terms of equity. We do not for example, question whether champagne consumption is fairly distributed.’ This paper is about the debate on occupational pensions in continental Europe. Instead of looking at the financial issues, it looks at the elements of social protection and solidarity within occupational pensions. Occupational pensions are of increasing importance for continental European society. This is indicated by a so-called ‘new pension order’ that is predominantly influenced by the Anglo-Saxon vision of pensions. However, much of the ongoing (legal) debate on pension reform deals with elements such as fairness and redistribution.

scholarly journals Recognising Unpaid Care in Private Pension Schemes

2016 ◽  
Vol 16 (4) ◽  
pp. 517-534 ◽  
Author(s):  
Myra Hamilton ◽  
Cathy Thomson
Keyword(s):  
Oecd Countries ◽  
Public Pension ◽  
Private Pension ◽  
Design Features ◽  
Private Pensions ◽  
Unpaid Care ◽  
Pension Schemes

Parents and carers often have interrupted workforce histories, causing gaps in their pension contributions and hence significantly lower retirement incomes. In some countries, to ameliorate these inequalities, carer credits have been introduced to maintain public pension contributions during periods of workforce absence. But improvements to credits in public schemes have taken place alongside a shift to private pensions that widens inequalities for carers. Introducing carer credits to private pensions is one method of addressing these inequalities. A search for examples of credits to private schemes in OECD countries revealed that, at present, they are rare and limited. This article sets out the design features and principles that should underpin carer credits to private pensions.

Altersrenten und sozialer Ausgleich in Deutschland und Österreich – ein Vergleich anhand von Modellrechnungen

2021 ◽  
Vol 70 (99) ◽  
pp. 2-25
Author(s):  
Florian Blank ◽  
Erik Türk
Keyword(s):  
Old Age ◽  
Early Retirement ◽  
Ideal Type ◽  
Public Pension ◽  
Pension Insurance ◽  
Model Calculations ◽  
Pension Schemes ◽  
Old Age Pensions ◽  
Life Courses ◽  
Stable Employment

Die Gegenüberstellung der Rentenansprüche für einheitliche, idealtypische Biografien ermöglicht den Vergleich von Unterschieden der Rentensysteme selbst. Die von der OECD erstellten Modellbiografien mit durchgehenden Erwerbsverläufen, abschlagsfreiem Renteneintritt und stabilen Einkommenspositionen bilden den Ausgangspunkt für den Vergleich der Rentenversicherungen Deutschlands und Österreichs. Die Vorgehensweise der OECD wird dargestellt, sofern erforderlich korrigiert, aktualisiert und weiterentwickelt. Zusätzlich werden Arbeitslosigkeit, vorzeitiger Renteneintritt sowie Kindererziehungszeiten berücksichtigt. Durch diese Ergänzungen werden eine höhere Realitätsanbindung erreicht und Elemente des sozialen Ausgleichs einbezogen. Es zeigt sich, dass die österreichische Pensionsversicherung in jeder Konstellation deutlich höhere Leistungen gewährt, die Elemente des sozialen Ausgleichs den Abstand teils vergrößern, teils verringern. Abstract: Old-age Pensions and Social Equalization in Germany and Austria – a Comparison Using Model Calculations A comparison of pension entitlements based on ideal-type biographies allows for an identification of differences between pensions systems. We compare public pension schemes in Germany and Austria, starting with the OECD’s model biographies. These biographies are signified by stable employment careers and income positions, and regular retirement without deductions. The OECD’s approach is discussed, revised, updated, and amended. Periods of unemployment and childcare and early retirement are included. This leads to more realistic life courses and means an inclusion of redistributive measures. The Austrian pension insurance delivers higher benefits in every constellation discussed; redistributive elements partly increase, partly reduce differences.

Pensions and the reduction of non-wage labour costs. Modelling a decade of reforms in Germany

2002 ◽  
Vol 12 (4) ◽  
pp. 277-291 ◽  
Author(s):  
Johan Jerone De Deken
Keyword(s):  
European Union ◽  
Social Security ◽  
Social Insurance ◽  
Pension Reform ◽  
The European Union ◽  
The Past ◽  
Wage Labour ◽  
Pension Schemes ◽  
Labour Costs

The reduction of non-wage labour costs has become a top priority of virtually all social insurance reforms in the European Union. This paper starts out by discussing the levers politicians can theoretically manipulate to lower non-wage labour costs without undermining the equilibrium between revenue and expenditure in social security, focusing on pension schemes. After a discussion of general options open to policymakers, the paper discusses the reforms in Germany during the past decade, in particular the most recent pension reform that seeks to introduce a privately administered funded element into the statutory scheme. It concludes by critically assessing the extent to which this partial return to funding will allow the country to overcome the pending demographic crisis of social security, and by pointing to reform options that have not been considered.

Staatlich geforderte Altersvorsorge als Losung der Rentenproblematik?

2002 ◽  
Vol 51 (3) ◽  
Author(s):  
Bernd Raffelhüschen ◽  
Johann Eekhoff ◽  
Markus Jankowski ◽  
Michael Voigtländer ◽  
Bert Rürup
Keyword(s):  
Old Age ◽  
Low Income ◽  
Security Policy ◽  
Capital Investment ◽  
Pension Reform ◽  
Security System ◽  
Standard Of Living ◽  
Pension Scheme ◽  
Private Saving ◽  
Old Age Security

AbstractIn this paper Bernd Raffelhüschen gives some insights into the political decision making process which changed the latest German pension reform from a fundamental step towards sustainability into a reform to be reformed. Nevertheless, he explains that the pension reform still bears a fundamental change, since it reduced transfers and at the same time opened for tax-preferred private and occupational pension plans. Hence, his paper investigates how these measures are developing presently and will develop in the future. Finally, some educated guesstimates are derived concerning those further reform steps to be undertaken in order to ensure the sustainability of a reduced pay-as-you-go scheme in future Germany.In their contribution, Johann Eekhoff, Markus Jankowski and Michael Voigtländer discuss the pros and cons of the Riester pension scheme. This so called “Riesterrente” involves a taxation scheme which can be regarded as a first step towards a consumption based taxation and can be justified in order to maintain intertemporal neutrality. The additional financial support for families and low-income earners, however, is neither based on efficiency grounds nor on a reasonable way of redistribution. The financial advantages are only granted if the capital investment is made in approved types of financial services. These restraints on capital investment will distort the functioning of the capital market which might lead to reduced economic growth and unemployment. Therefore, the authors conclude that the favouring of certain types of private saving should be abolished for the benefits of introducing consumption based taxation.Bert Rürup argues that central issues of last year’s pension legislation were a limitation of the growth of expenditures and as a result also a limitation of the expansion of the contribution rate as well as a redistribution in favour of younger generations as a precondition for intergenerational justice. The simultaneous reduction of the pay-as-you-go financed first pillar of old-age security while strengthening the funded pillars of old-age security helped to reach those targets.In his paper he argues that at the same time it was politically decided to melt down - in relative terms - the extent of the first pillar while simultaneously preserve the function of the old-age security system as an instrument to secure the standard of living after retirement. That also meant not to cut back the statutory pension insurance to a flat rate system in the long run. It should together with benefits from private systems guarantee - on the average - to keep up the income position reached in the period of professional activity also after retirement. This specific target makes state subsidization of private old-age security plans inevitable. The only alternative would be to turn the mandatory system into a compulsory one which would be the “cheaper” solution. The author states that compulsory saving for old-age security purposes versus targeted subsidization has distributive disadvantages and would hamper basic rules of market economy. And it would in Germany be impossible to be introduced due to political reasons.If for normativ reasons (“lean state”) the state organized old-age security system should be reduced e.g. like in Great Britain to the level of a system that provides protection against poverty, consequently state subsidization of private saving for old age purposes must be rejected. The first question to be answered is: Should state old-age security policy be directed towards maintaining the standard of living reached in working life or should it create only something like basic security? If that question is being answered in favour of the first, then a discussion on the nature and extent of state subsidization of private saving for old age purposes makes sense.

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