Forum SECURING PENSIONS FOR THE NEXT FIFTY YEARS – ACHIEVEMENTS OF RECENT REFORMS IN SELECTED COUNTRIES

Public pension systems following the pay-as-you-go (PAYG) principle are experiencing increasing pressure. Apart from system-immanent problems such as diminished labour supply incentives due to the partial tax character of contributions and distor-tions of relative prices of labour and other production factors these developments can be mostly attributed to demographic changes. Increasing longevity, for example, extends the period of inactivity and depen-dency (see Table 1 and Figure 1).1 Apart from this permanent development, declined birth rates have already started to change the age structure of the pop-ulation, augmenting the size of older cohorts while decreasing the younger population’s share. Although fertility rates are not expected to fall below current levels within the next 50 years (see Table 2), the pas