Transcript Presentation

Pension System
Sustainability
Challenges
Anita M. Schwarz
Lead Economist, Social Protection
and Labor Global Practice,
World Bank
Elderly population is growing while working age population is
shrinking
70.0%
Projected Change Between 2015 and 2030
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
-10.0%
-20.0%
-30.0%
Working Age
Old Age
Source: UN Populations Projections 2015
Pension System Sustainability Challenges
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Many countries in Europe will not be able to afford much more than basic
pension + disability by 2050 without raising spending levels
20.0%
Basic Pension for All as % of GDP
Disability Spending as % of GDP
Top-up for Covered Population as % of GDP
Survivor Spending as % of GDP
Percent GDP
15.0%
Average Current Spending
10.0%
5.0%
0.0%
Source: World Bank, Inverting Pyramid, 2014
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But if retirement ages are raised to 15 years before retirement, most
countries could provide the same generosity they provide today
Basic Pension for All as % of GDP
Disability Spending as % of GDP
Top-up for Covered Population as % of GDP
Survivor Spending as % of GDP
16%
14%
Percent GDP
12%
10%
Average Current Spending
8%
6%
4%
2%
0%
Source: World Bank, Inverting Pyramid, 2014
Pension System Sustainability Challenges
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What’s needed to make this happen




Labor market flexibility
Skills
Savings infrastructure
MOST IMPORTANT OF ALL: Good public
communication
Pension System Sustainability Challenges
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