The Ageing Working Group (AWG) assesses the long-term sustainability of public finances by presenting a set of public expenditure projections for all Member States, including projections on pensions. These projections are based on demographic forecasts and agreed assumptions on key economic variables. The adequacy and sustainability of pensions are, however, two sides of the same coin and a full assessment of pensions therefore requires integration. This paper applies the dynamic micro-simulation model MIDAS to assess the consequences of the AWG projections and assumptions on the future adequacy of public pensions in Belgium, Germany and Italy. A comparison of the simulation results suggests that the impact of the parametric pension reform in Belgium and Germany and the systemic reform in Italy on (re) distribution and the risk of low-income go in the same direction, but that the magnitudes differ. Indeed, the impact is stronger in Italy than in Belgium and Germany. In the latter especially, important changes safeguarding the sustainability of the pension system seem to have had a relatively small impact on the risk of low-income among pension benefit recipients in particular.

The Flip Side of the Coin: The Consequences of the European Budgetary on the Adequacy of Social Security Pensions”

Simone Tedeschi;
2010

Abstract

The Ageing Working Group (AWG) assesses the long-term sustainability of public finances by presenting a set of public expenditure projections for all Member States, including projections on pensions. These projections are based on demographic forecasts and agreed assumptions on key economic variables. The adequacy and sustainability of pensions are, however, two sides of the same coin and a full assessment of pensions therefore requires integration. This paper applies the dynamic micro-simulation model MIDAS to assess the consequences of the AWG projections and assumptions on the future adequacy of public pensions in Belgium, Germany and Italy. A comparison of the simulation results suggests that the impact of the parametric pension reform in Belgium and Germany and the systemic reform in Italy on (re) distribution and the risk of low-income go in the same direction, but that the magnitudes differ. Indeed, the impact is stronger in Italy than in Belgium and Germany. In the latter especially, important changes safeguarding the sustainability of the pension system seem to have had a relatively small impact on the risk of low-income among pension benefit recipients in particular.
File in questo prodotto:
Non ci sono file associati a questo prodotto.

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11580/81110
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 13
social impact