Social Agenda Issue 52 - EN

Pensions are the main source of old-age income. They are therefore key to preventing income poverty. So how do pensions help maintain the income of men and women for the duration of their retirement and prevent old-age poverty? In other words, to what extent are they adequate? This is what the 2018 EU Pensions Adequacy Report analyses. Its aim is to support Member States in designing pensions systems that are (socially) “adequate” while remaining (financially) “sustainable". As this report is triennial, it was the first to come out since amajor shift in the pension reform dynamic took place around 2015: soon after the previous report was adopted, more EU Member States started refocusing their reformefforts towards pension adequacy, as opposed to simply stabilising pension expenditure (see Social Agenda n°43). They did this for example through measures to safeguard the adequacy of the lower range of pension income, by introducing or raising minimum pensions and/or indexation. Although the EU target for reducing the overall number of people at risk of poverty and social exclusion by 2020 is most likely to be missed for the population as a whole, the 2018 Pensions Adequacy report shows that the EU is on target as far as people aged 65 and more are concerned. A right The 2018 report was also the first one to come out since the adoption by the European Commission of the European Pillar of Social Rights and its proclamation by EU leaders in 2017. Principle 15 of the Pillar recognises the right of all workers, including the self-employed and those on non-standard job contracts, to a pension that ensures adequate income, and the right of women and men to equal opportunities to acquire pension rights. The adequacy report is therefore closely related to two proposals that the Commission put forward at the beginning of 2018 and which are going through the EU decision-making process: For a Recommendation on access to social protection for workers and Targeting working-age workers: EU countries should close the pensions gender gap by putting in place equal opportunity policies targeted at women and men of working age. Pensions – Towards more adequacy 2018 report captures the growing momentum in favour of pension adequacy © Belga Image SOCIAL AFFAIRS 8 / SOC I A L AG E NDA / J U LY 2 0 1 8