Almost half world's older persons lack pensions
An ILO report said 52 percent of older persons receive a pension, but
levels are inadequate and the trend has been worsened by fiscal
consolidation.
GENEVA: Nearly half, 48 per cent, of all people over pensionable age
in the world do not receive a pension, and for many of the 52 percent
who do coverage is not adequate, said a new report by the International
Labour Organisation (ILO).
As a result, the majority of the world's older women and men have no
income security, have no right to retire and must keep working as long
as they can - often in poorly paid, precarious conditions.
The ILO policy paper 'Social Protection for older persons: Key policy
trends and statistics' showed that in recent years many middle and
low-income countries have been rapidly expanding pension coverage
through a mix of contributory and non-contributory, tax-financed social
pensions.
The report looked at pension systems in 178 countries. It found more
than 45 countries have reached 90 per cent pension coverage and more
than 20 developing countries have achieved or nearly achieved universal
pension coverage.
"Many developing countries are boldly expanding their pension
systems, a very positive trend," said Director of the ILO's Social
Protection Department, Isabel Ortiz.
"But as important as expanding coverage, is guaranteeing adequate
pension benefits. Older men and women have a right to retire in dignity,
without falling into poverty. This is an issue worldwide,"she said.
Remarkable increases in pension coverage were achieved in only a
decade in places such as China, Lesotho, Thailand, Timor Leste and
Tunisia, ranging from about 25 percent to more than 70 percent of the
population.
Tax-financed pensions play a major role in extending pension
coverage, as they ensure a basic level of protection for those not
receiving a contributory pension.
According to the report, fiscal consolidation policies adopted from
2010 have led to reduced social protection for older people.
Adjustment measures include cuts in health and other social services
and pension reforms such as raising the retirement age, reducing
benefits and increasing contribution rates.
"These adjustments are undermining the adequacy of pension and
welfare systems and reducing the ability to prevent poverty in old age,"
said Ortiz.
"The long-term liabilities of austerity take time to show up.
Depressed household income levels are leading to lower domestic
consumption and slowing down economic recovery.
It is alarming that future pensioners will receive lower pensions in
at least 14 European countries by 2050," she said.
Ortiz said that the positive impacts of social protection on social
and economic development, for example through boosting consumer spending
and promoting more inclusive economic growth, have put social protection
at the forefront of the development agenda. Many middle-income countries
are enlarging social protection as part of their strategy to drive
economic growth.
"China, for example, has achieved nearly universal coverage of
pensions and increased wages," Ortiz said.
Some countries, including Argentina, Bolivia, Chile, Hungary,
Kazakhstan and Poland, are reversing the earlier privatisation of their
pension systems of the 1980s and 1990s because they were too expensive
and did not expand pension coverage.
The full or partial renationalisation of these pension schemes aims
to reduce the fiscal costs, to improve pension coverage and old-age
income security.
"Public social security systems with strong social protection floors
are essential for economic recovery, inclusive development and social
justice, and therefore, must be an integral part of the post-2015
development agenda," said Ortiz.
"Social protection in old age is a human right backed by
international labour standards. It also makes good economic sense," she
said.
The ILO promotes policies and provides assistance to its member
states to help extend adequate levels of social protection to all
members of society.
The ILO Social Protection Floors Recommendation, 2012 (No. 202),
which calls for the extension of social protection coverage, following
the principles of universality of coverage, non-discrimination and
gender equality, was adopted by 185 countries and further endorsed by
G20 leaders and the United Nations.
- ILO News |