The examples of our European neighbors, frequently brandished during debates on pension reform, are rarely convincing as the systems are complex and different.
by Mathilde Damgé, Dorian Jullien and William Audureau
“The pension reform is essential when you compare yourself in Europe,” said President Emmanuel Macron end of January . Since the presentation of the bill, comparisons with this or that European country arise regularly in the debate, whether it is to justify the reform or on the contrary to criticize it.
But is it really relevant to compare the New State British pension, based on a high dose of capitalization, and France, which favors distribution? Baltics, including more than a third of retirement resources are activity income (as retirees), and the French, who work the least in Europe once retired?
Different pension schemes, more or less important capitalization, differences in the legal age, real age or pension levels: contrasts from one country to another are so strong as it becomes risky to take only one element to compare countries.
a distribution model, or not
At the heart of the spirit of the distribution pension system is the idea that assets contribute for previous generations. Conversely, capitalization involves contributing only for oneself (or for your business) and touching your nest eggs once retired.
All European countries have a distribution retirement system … Bataché of capitalization to variable degrees. In the United Kingdom and the Netherlands, the sums managed by pension funds or private pension funds weigh for more than half in total retirement expenses .
Only exception to the breakthrough of capitalization, France works completely by distribution, both for its basic regime and for complementary diets – which does not prohibit, of course, to build up a savings for yourself his retirement. This principle is not called into question by the reform proposed by the government.
Another difference: in the United Kingdom and the Netherlands, there is a basic package, a minimum sum paid to retirees, regardless of their salary level. If this mechanism is strongly redistributive on the principle, the package is relatively low compared to the standard of living: it represented 830 euros for a British retiree and 1,300 euros for a Dutchman. In all other countries, which base the compulsory regime on wages, Pension levels vary enormously : between a third of the old salary in the Baltic countries and 90 % in Hungary or in Portugal.
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