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Welfare Reform on the Web (February 2008): Pensions - overseas

A comparative analysis of mandated private pension arrangements

M. Hyde and J. Dixon

International Journal of Social Economics, vol. 35, 2008, p. 49-62

According to one influential set of arguments, the privatisation of pensions is an integral element in a broader programme of welfare retrenchment, informed by neoliberalism, which has been designed to divest the state of its responsibility for the financial security of retired people and which will intensify retiree poverty in years to come. This paper takes issue with this negative characterisation of pensions privatisation. It assesses empirically the extent to which the architects of 32 mandated private pension arrangements have engaged with market principles. This assessment shows clearly that a strong market orientation, as expounded by neoliberalism, is not a universal feature of pensions privatisation. This might suggest that privatisation can be consistent with collective responsibility for retirement futures.

Germany: a pensions hotspot

F. Fabrizi

European Pensions, Sept/Oct. 2007, p. 21-23.

This article looks at how the German pensions market has evolved in the last ten years and draws comparisons with other European countries including the UK. Includes a case study of Fidelity International's new value account (a kind of flexible pension) for its employees based in Germany.

Is there a social security tax wedge?

A. Cigno

Labour Economics, vol. 15, 2008, p. 68-77

In a Beveridgean pension scheme, individual benefits are independent of individual contributions, and the marginal return to labour coincides with the marginal take-home pay. The whole of the pension contribution is therefore a tax on labour. In a Bismarckian system, in contrast, the marginal return to labour is higher than the marginal take-home pay, because it includes the present value of the marginal pension benefit. If the benefit formula is actuarially fair, the contribution is a mandatory form of saving, not a tax on labour. Thus a Beveridgean pension scheme discourages labour, and is bad for efficiency. A Bismarckian scheme may encourage labour, and be good for efficiency.

Transforming retirement: re-thinking models of retirement to accommodate the experiences of women

C. Everingham, P. Warner-Smith and J. Byles

Women's Studies International Forum, vol. 30, 2007, p. 512-522

Like other governments in the developed world, Australia is currently re-thinking its retirement policies in the light of population ageing. It is encouraging older workers to postpone retirement, and has developed a new transitional model which promotes flexible work options to ease workers out of the workforce over a longer period. This study looks at the meaning of this 'transitional phase' to women in different family and work situations. Three different models of retirement emerged. Some women in the study retired in the traditional manner and stopped paid work completely for health or family reasons. They looked forward to expanding their voluntary and leisure activities and spending more time with their families. For a second group, cutting their hours of paid work enabled them to slow down and retire later than they might otherwise have done. The third group were committed to continuing their paid work into their retirement years. They aimed to acquire new skills and build up another working life, but one over which they had more control.

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