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ETUC foreword: EN, FR, IT, DE, ES, PL, RO, BG, PT, EL (GR), HU
The 2024 Pension Adequacy Report, jointly prepared by the European Commission and the Social Protection Committee, provides a state of play of pension adequacy and key challenges across the EU. The Pension Adequacy Report was endorsed by the EPSCO Council of 20 June 2024 with the adoption of Council Conclusions on Pension Adequacy.
The report is prepared in parallel with the Ageing Report of the Economic Policy Committee and the Commission.
The ETUC thanks DG EMPL and the Social Protection Committee for the preparation of the 5th edition of the Pension Adequacy Report (PAR). Its in-depth analyses of functioning and performance of pension schemes across the EU represent an indispensable complement to the Ageing Report, which essentially only estimates the future development of the (public) costs of pension systems against the background of population ageing.
The PAR raises serious concerns for the EU ageing population:
- Old age protection of many older people is still insufficient to guarantee the rights enshrined in the Pillar, both regarding poverty avoidance and income maintenance. The data presented in the PAR point out
- The risks of poverty and social exclusion since 2015 have slowly increased
- Even average earners with several decades of uninterrupted employment career suffer a massive loss of income after retirement in several Member States
- Women are particularly affected by inadequate pensions
The ETUC calls for urgent actions:
- Adequate pension entitlements should be strictly related to quality jobs and secure career paths. Major interventions have to be made at employment and labour market level. The achievement of the EPSR Action Plan’s key employment targets (raising the employment rate among those of working age by 5 pp, halving the gender employment gap, creating quality jobs) would substantially benefit both pension adequacy and the financial sustainability of pension systems.
- Moreover, pension systems have to be reformed in order to meet the current and future needs of generations facing lack of investments supporting overall career quality as well as major transitions such as the digital and the environmental ones.
- It is urgent to tackle the evident inadequate compensation mechanisms in many pension schemes: systems must address the reduced earning capacity in connection with childcare or caring for relatives, activities which are still largely carried out by women, but also long-term involuntary unemployment.
- The progressive individualisation and privatisation of pension rights has to be stopped and reversed. In addition – and this aspect is unfortunately missing in the report – is a risk analysis of the growing number of funded parts of the pension systems in which the insured persons or pensioners bear the investment risks.