Pension Policy

Retirement systems vary throughout the world, but all face similar challenges. Many countries are experimenting with new approaches for addressing these challenges. Their experiences provide a testing ground for concepts that can provide guidance as U.S. policymakers look for new ways of providing retirement security for American workers.

Below are links to summaries of innovative features of retirement plans in other countries. To read more about the retirement systems of these and other countries, and view a chart comparing the levels of income security they provide, review these country comparisons.

Australia:

• Australia's occupational pension system requires all employers to contribute nine percent of employees’ pay to a retirement plan.
• Australia maintains a Lost Members Register to help workers find their pension plans and plans find workers with whom they have lost contact.
• An alternative dispute resolution program decides disputed pension claims.
• Independent trustees supervised by the government, rather than employers, administer most Australian pension plans;
• Australia has transparent rules regarding fee disclosure.

The Netherlands:

• The Netherlands has Collective Defined Contribution Plans, where, as in traditional U.S. pension plans, employers contribute to professionally managed, pooled investment plans that make lifetime payments to retirees and their spouses, but where, unlike U.S. pension plans, employees and retirees collectively share the risk of investment losses (see also the Center for Retirement Research's paper brief, Sharing Risk: The Netherlands' New Approach to Pensions).

New Zealand:

• The KiwiSaver program provides incentives for workers to save for retirement and purchase a first home.

The United Kingdom:

• The U.K. maintains a Lost Pension Plans Registry, which helps retirees who are unable to locate their plans.
• The Pension Advisory Service helps individuals who have retirement plan questions and problems.
• Revaluation provides inflation protections for employees who leave plans before retirement age.
• Private retirement plans' boards of trustees must have some degree of employee representation.
• Stakeholder pensions are individual savings plans for workers that are offered by employers who do not offer a retirement plan.

These summaries were prepared by John Turner, a leading expert on retirement programs around the world and co-author of "Private Pension Policies in Industrialized Countries." If you know of other innovative concepts, contact jturner@pensionrights.org

An excellent resource for information about retirement plans in other countries is AARP’s Global Aging Program.

See, for example:

Mandatory Employer Pensions in Ireland, Germany, and the United Kingdom (January 2007)

A brief comparison of five nations’ occupational pension systems, including the U.S. (Spring 2006)

Other Global Aging publications

Pension Coverage Lessons for the United States from Other Countries, by Martin Rein and John Turner, AARP Public Policy Institute (February 2004)