An in-depth review of how current and future pensions can help prevent old-age poverty was published by the European Commission on April 30. Titled “The 2018 Pension Adequacy Report”, it calls on European Union member states to pay more attention to sustainable, adequate pensions in their reforms.
“Every retired person has the right to live in dignity,” said Marianne Thyssen, Commissioner for Employment, Social Affairs, Skills and Labour Mobility. “This is a key principle of the European Pillar of Social Rights. Adequate pensions are essential in preventing poverty and social exclusion among older people in Europe, especially women. And we need to make that sure that people in non-standard work or self-employment are not left out. Our priority must to be to pursue ongoing reforms that encourage adequate pensions for everyone.”
According to the European Commission, there is 1.9m fewer older Europeans at risk of poverty or social exclusion than a decade ago, while the number of older workers in employment has increased by 4.1m in the last three years alone.
There is little room for complacency. According to the report, today some 17.3m or 18.2% of older people (aged 65 and over) in the EU remain at risk of poverty or social exclusion. This amount has remained nearly unchanged since 2013. In addition, significant differences between countries and population groups remain.
The data also show that women’s pensions are still 37% lower than men’s due to lower salaries and shorter working lives linked to caring responsibilities. Similarly, people in non-standard or self-employment often face less favourable conditions for accessing and accruing pension rights than those in standard employment.
The risk of poverty and social exclusion in old age also increases with age. More than half of all older people at risk of poverty or social exclusion in the EU are aged 75 or over. This is due to the fact that while needs increase with age, the value of pensions decreases during retirement.
The Pension Adequacy Report 2018 and its set of policy conclusions were adopted by the Social Protection Committee on April 25. The report’s policy conclusions will be endorsed by the Employment, Social Policy, Health and Consumer Affairs Council in June and will feed into the European Semester process.