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Pensions reforms have slowed in OECD countries but need to continue

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Further reforms are needed across OECD countries to mitigate the impact of population ageing, increasing inequality among the elderly and the changing nature of work, according to a new OECD report.

Pensions at a Glance 2017 says that public spending on pensions for the OECD as a whole has risen by about 1.5% of GDP since 2000. However, the pace of spending growth is projected to slow substantially. 

 At the same time, recent reforms will lower the incomes of many future pensioners. People will live longer and to ensure a decent pension would have to postpone the age of retirement.

“The challenges of financial sustainability and pension adequacy mean that bold action from governments is still needed,” said OECD Secretary-General Angel Gurría. “The world of work is changing fast and policy makers must ensure that decisions made today take this into account and our pension and social protection systems do not leave anyone behind in retirement.”

 The net replacement rate from mandatory pension schemes for full-career average-wage earners entering the labour market today is equal to 63% on average in OECD countries, ranging from 29% in the United Kingdom to 102% in Turkey. On average, replacement rates for low-income earners are 10 points higher and range from under 40% in Mexico and Poland, to more than 100% in Denmark, Israel and the Netherlands.

 Over the past two years, one-third of OECD countries changed contribution levels, another third modified benefit levels for all or some retirees and three countries legislated new measures to increase the statutory retirement age. Under legislation currently in place, by 2060 the normal retirement age will increase in roughly half of the OECD countries, by 1.5 years for men and 2.1 years for women on average, reaching just under 66 years. The future retirement age will range from 60 years in Luxembourg, Slovenia and Turkey to 74 in Denmark, according to the latest estimations.

 The projected increase in retirement ages will be exceeded, however, by expected advances in longevity, meaning that the time people spend in retirement will increase relative to people’s working lives. Employment at older ages will need to increase further to ensure adequate pensions for many people, according to the report.

 Pensions at a Glance 2017 also looks at ways countries can meet the growing calls for more flexible retirement options. Rigidly set retirement ages might not be beneficial for society as a whole. Currently, only around 10% of Europeans aged 60-69 combine work and pensions. Of those that do work beyond the age of 65, half work part-time — a share that has been stable since the 1990s. Several countries including Australia, the Czech Republic, France and the Netherlands allow for early partial-retirement schemes.

 Obstacles to combining work and pensions after the official retirement age exist, for example through earnings limits in Australia, Denmark, Greece, Israel, Japan, Korea and Spain. Barriers to continuing to work beyond the retirement age also exist outside the pension system, especially through age discrimination from employers or in cultural acceptance of part-time work.

 Overall, for people with full careers, retirement is more flexible around the retirement age in Chile, the Czech Republic, Estonia, Italy, Mexico, Norway, Portugal, the Slovak Republic and Sweden.

 Policy makers need to ensure that postponing retirement should be sufficiently rewarding while not overly penalising people who retire a few years before the normal retirement age. In Estonia, Iceland, Japan, Korea and Portugal, the financial incentives to continue working after the retirement age are large but costly for pension providers. Flexibility should be conditional on ensuring the financial balance of the pension system, with pension benefits actuarially adjusted in line with the flexible age of retirement.

 Pensions at Glance 2017 provides comparative indicators on the national pension systems of the 35 OECD countries, as well as for Argentina, Brazil, China, India, Indonesia, the Russian Federation, Saudi Arabia and South Africa.

 Country notes are available for Australia, Canada, France, Germany, Italy, Japan, Spain, Switzerland, the United Kingdom and the United States.

 A recent OECD report, Preventing Ageing Unequally, also analysed the impact of rising inequalities and population ageing. It found that younger generations will face greater risks of inequality in old age than current retirees and for generations born since the 1960s, their experience of old age will change dramatically relative to that of previous generations.

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‘Reset Earth’: Animation film & mobile game bring Gen Z into protecting ozone layer

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Image: UNEP/Ozone Secretariat

‘Reset Earth’ is an innovative educational platform for adolescents about the fundamental role of the ozone layer in protecting the planet. The platform launches on World Education Day (January 24th) with an original animation film that explores options for collective positive action. The film’s plot continues in a challenging mobile game for Android and IOS (February 10th). The platform is initiated by United Nations Ozone Secretariat to sustain the protection of the ozone layer through the sensitization and engagement of Gen Z.

Ozone-depleting substances (ODSs) like CFCs, HFCs, HCFCs have been widely used throughout the 20th century, mostly for refrigeration, in air conditioners and aerosol sprays. ODSs threaten the earth’s upper atmosphere, drive up temperatures and account for close to 11 per cent of total warming emissions to date. Since the 1980s, the international community has acted to protect the ozone layer by banning or strictly restricting the use and production of such super greenhouse effect gases. Consequently, the Antarctic ozone is expected to close by the 2060s (without action, it might have been 40 per cent larger by now) and other regions will return to 1980s values even earlier.

Meg Seki, Acting Executive Secretary of the Ozone Secretariat, said, “The protection of the ozone layer cannot be considered a done deal. It must be a continuous effort by us and by future generations. If our children learn about the grim consequences of a ruined ozone layer, they will act to keep it only as part of a fantasy game.”

Reset Earth begins a year-long education initiative by the Secretariat to raise awareness and inspire action among adolescents and parents about global ozone protection. Immersive, educational and thought-provoking, Reset Earth conveys a positive message around what can be achieved through collective action and cultivates a sense of environmental responsibility and ownership amongst the youth.

The Reset Earth animation film is set in a dystopian post-apocalyptic world in 2084, where the ozone layer has been completely ruined and human life is under threat from an unstoppable virus called “The Grow”. It is the story of three teenagers who team up in an epic time-travel adventure to save the planet and what’s left of human life. Their mission is to find out what caused the “The Grow”. They travel back to critical historical moments in the story of the mysterious ‘ozone layer”, essential to stopping the virus, and learning as they go about the fundamental role it plays in protecting the health wellbeing of the planet. To save the ozone layer, they must jump back in time to ensure the signing of the Montreal Protocol agreement.

The Reset Earth mobile game is a single player platform game, combining a retro graphics style and hand-drawn artwork and aligned with the film’s storyline. Players – whether adolescent gamers or their parents – switch between characters and utilize their unique abilities throughout four levels of the game. Through unlocking puzzles, players learn about environmental history and the science of protecting the planet.

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Environment

Serving up sustainable food

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Along with a vow to return to exercise, upping personal intake of fruit and vegetables tops the list of New Year’s resolutions for many. But what if this year’s resolution didn’t end with the eating – and extended to reducing the amount of healthy, nutritious produce that gets trashed?

That’s a commitment that the United Nations Environment Programme (UNEP) is banking on to help achieve the Sustainable Development Agenda.

Global estimates suggest that roughly one-third of food produced for human consumption is lost or wasted every year. Those 1.3 billion tons of fruits, vegetables, grains and roots are lost through spillage or spoilage in the harvest-to-market chain, or to spoilage and discard once products hit retailers and, eventually, consumers.

In a world where malnutrition is a contributing factor to roughly 45% of deaths of children under age five in developing countries, and where consumption of highly processed foods is pushing obesity rates ever higher, remaining accountable to those New Year resolutions isn’t just personal – they’re critical for humanity.

They are also critical for the survival of the planet. Food production, consumption and waste – and how they impact the environment – will be a key topic of discussion at this year’s United Nations Environmental Assembly (UNEA-5), taking place online on 22-23 February 2021.

UNEP and partners are developing the world’s most comprehensive data analysis and modelling on food waste, which will be launched at the Assembly. Titled the ‘Food Waste Index’, the document will be released at UNEA-5. It offers new estimates of food waste at household, retail and food service sectors at country level, and provides a methodology that enables countries to measure and track progress on Sustainable Development Goal 12.3, which aims to halve retail and consumer food waste and reduce food loss by 2030.

Food systems for the future

Agriculture and the pressure to produce cheaper, faster commodities are among the primary drivers of biodiversity loss. Resource-intensive food production that depends heavily on the use of inputs such as fertilizer, pesticides and complex irrigation and energy systems means fewer wild spaces for the other creatures we share nature with, whether it’s birds, mammals, insects or microbial organisms. Meanwhile, political and economic structures are pricing farmers off their land.

“The COVID-19 pandemic revealed the obstacles and blockages in our global food system. We have a timely opportunity to build back better and redesign the way we grow, harvest, sell and eat the bounty of nature’s production,” said Clementine O’Connor, from UNEP’s Sustainable Food Systems Programme.

Transforming our food systems will not only help restore biodiversity and habitat but can also strengthen market opportunities for smallholder farmers – many of whom are women on the road to economic self-sufficiency through sustainable production of fruit and vegetables.

A fruitful year?

At UNEA-5, the virtual convening of representatives of UN member states, the private sector, civil society, scientists and other leaders will be an opportunity to share and adopt best practices for transforming food systems. Momentum toward sustainable food production and consumption that is generated by the Assembly will be built upon going forward in 2021, with the historic first-ever UN Food Systems Summit.

The year 2021 has also been marked by the Food and Agriculture Organization of the United Nations (FAO), as the International Year of Fruits and Vegetables 2021 to highlight the role of fruits and vegetables in human nutrition, livelihoods, food security and health.

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Finance

ILO and LinkedIn launch data insights partnership

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The International Labour Organization (ILO), the Partnership for Action on Green Economy (PAGE)  and LinkedIn have launched a two-year data insights partnership that aims to improve government decision-making, promote green jobs and build the capacities of governments to identify and provide training opportunities.

Through the Memorandum of Understanding (MoU) signed between the ILO and LinkedIn on 15 January 2021, the partners hope to support the development of deep, cross-sector partnerships that benefit governments, the private sector, employers’ and workers’ organizations and civil society organizations. This partnership also supports the achievement of the Sustainable Development Goals (SDGs)  and meeting the unique challenges posed by the COVID-19 pandemic.

LinkedIn’s real-time view into the global labour market will enable partners to leverage its insights into the skills, jobs and occupations that are quickly rising in demand. For example, LinkedIn’s granular, skills-based understanding of green jobs will also detect emerging trends by analysing occupations whose titles may not identify them in a traditional “green” role but are increasingly reliant upon green skills. Complementary LinkedIn data on hiring trends by gender and region will also provide unique insights into the world of work. 

Thanks to its MoU with the ILO, these data can now help inform policy recommendations as well as further research and analysis, with a particular focus on supporting governments to transition to green economies within the context of PAGE’s work on green jobs as well as helping governments and labour market institutions become more responsive to the needs of workers and employers through the promotion of targeted skills training.

The LinkedIn-ILO partnership also welcomes the strategic collaboration of UNEP  and UNITAR , whose complementary mandates and expertise will help translate rich labour related data insights into informed policies and practical capacity building activities.

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