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Welfare Reform on the Web (February 2009): Pensions - overseas

The Canadian safety net for the elderly

M. Wiseman and M. Ycas

Social Security Bulletin, vol.68, no.2, 2008, p. 53-67

This article profiles the Canadian Guaranteed Income Supplement for poor pensioners and compares the system to the US Supplemental Security Income (SSI) Program. The Canadian minimum income guarantee for the elderly is substantially more generous that what is provided in the United States, but costs much more than the US programme. The authors estimate the total costs to Canada of providing income support to elderly persons receiving a Guaranteed Income Supplement in 2004 to be approximately US$11.1bn, almost fourteen times the US allocation for SSI and Food Stamps for elderly SSI recipients.

Chile's next generation pension reform

B.F. Kritzer

Social Security Bulletin, vol.68, no.2, 2008, p. 69-84

In 1981 Chile introduced a new system of privately managed individual accounts, replacing its public pay-as-you-go pension system. Law 20.255 enacted in March 2008 introduced a major reform that addressed many of the system's shortcomings. The law includes measures to provide adequate benefits to a larger portion of the population, ensure more gender equity, encourage greater competition in the pension fund industry, improve pension fund managers' handling of financial risk to increase the return on workers' contributions, change the rules for financing survivors' and disability insurance, establish more opportunities for voluntary savings, and improve financial literacy.

The macroeconomic impact of reforming a PAYG system: the Portuguese case

M.T. Medeiros Garcia and E. Graca Lopes

International Social Security Review, vol. 62, Jan.-Mar. 2009, p.1-23

The Portuguese state pension system has already undergone some reforms, including the amendment of the formulae used in calculating pensions and the creation of a reserve fund, signifying that individuals will have to save more for retirement. The roles of private occupational pension plans and personal saving plans have also been enhanced. This article uses the HERPOR model to analyse the impact of possible additional reforms of the existing pay-as-you-go pension system, including moving to a fully funded scheme, on the financial sustainability of the system and on a range of macroeconomic variables.

Pension fund governance : a global perspective on financial regulation

J. Evans, M. Orszag, and J. Piggott. (eds) Cheltenham: Edward Elgar, 2008

This book brings together original articles covering pensions governance around the world. It is organised in three main sections. The first section of the book explains the main frameworks for pension fund governance. The second looks at the practice and experience of pension funds in the United States and Australia. Finally, articles in the third section discusses the role of government guarantees.

Pension income replacement: permanent and transitory determinants

A. Hicks and K. Freeman

Journal of European Public Policy, vol. 16, 2009, p. 127-143

The authors analyse public pension income replacement rates (IRRs) for 18 affluent democracies, 1975-2000, using error correction models that allow for distinct longer-run and shorter-run estimates. Results from the error correction models show that economic globalisation, high economic growth and some varieties of domestic economic malaise (especially unemployment and public finance deficits) all affect income replacement rates. Where fixed-effect constraints on estimate precision are relaxed for temporarily quasi-invariant explanatory variables using Plumper and Troeger's fixed-effect variance decomposition model, cumulative Right cabinet strength, state-structural veto points and neocorporatism also figure in the limitation, if not reversal, of pension benefits.

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