How does social security compare to retirement programs in other countries?


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Category B

A system that has a solid structure, with many good features but a few areas for improvement.

Index value: 65-75

Countries: Finland, Sweden, United Kingdom, Singapore, Switzerland, Canada, Ireland, Germany, New Zealand, Chile

Class C +

Index value: 60-65

Countries: Belgium, Hong Kong SAR, United States, Uruguay, France

Category C

A system that has good characteristics, but also presents major risks and / or shortcomings that need to be corrected. Without these improvements, its effectiveness and / or long-term durability may be called into question.

Index value: 50-60

Countries: United Arab Emirates, Malaysia, Spain, Colombia, Saudi Arabia, Poland, China, Peru, Brazil, South Africa, Italy, Austria, Taiwan, Indonesia

Category D

A system that has some desirable features, but also has major weaknesses and / or omissions that need to be addressed. Without these improvements, its effectiveness and durability are in doubt.

Index value: 35-50

Countries: Japan, Mexico, South Korea, Turkey, India, Philippines, Argentina, Thailand

Break it

The averages of the index and sub-indices were decisive. For example, the average of all countries in the general index was 61.0, while the United States received a ranking of 61.4.

However, an inside look at fit, where the average was 62.2, the US scored 60.9; the overall durability average was 51.7, while the US was 63.6; and for integrity, the average was 72.1 while the United States was 59.2.

Uruguay, which received the same rating as the United States, had a much higher integrity rating, 74.4, while its durability was much lower, 49.2.

Overall, it seems that most countries did better in 2021 than in 2020. The US score rose to 61.4 in 2021 from 60.3 in 2020. Peru, New Zealand , South Korea, Indonesia, India and Argentina all lost almost a point or more in the total rankings of the index.

Recomendations

The study examines each country’s pension / social security issues, but overall it provides some recommendations, including:

  • Increase coverage of employees (including atypical workers) and the self-employed in the private pension system, recognizing that many people will not save for the future without an element of compulsion or automatic affiliation.
  • Increase the legal retirement age and / or the retirement age to reflect life expectancy.
  • Promote higher participation in the labor market at older ages, in particular to increase savings and reduce the length of retirement.
  • Encourage higher levels of private savings to reduce future dependence on public pensions, while adjusting the expectations of many workers.
  • Introduce measures to reduce the pension gap between men and women.
  • Reduce the leakage of retirement savings before retirement, in particular through taxation.
  • Review the indexation of these annuities to ensure that real value is maintained.
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About Ian Crawford

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