Australia’s pension/super system drops on index
Australia’s superannuation and pension system has dropped to fourth place on the Melbourne Mercer Global Pension Index in what appears to be a reflection of the strengthening of European systems and the impact of the gig economy.
The index, released today, has seen the Netherlands take top spot followed by Denmark, while Finland has bumped Australia into third spot with the index author, Mercer Australia senior partner, Dr David Knox, referencing a growing tension between adequacy and sustainability in global pension systems.
Knox’s analysis said that it was not enough for a system to be sustainable or adequate.
“An emerging dimension to the debate about what constitutes a world class system is ‘coverage’ and the proportion of the adult population participating in the system,” he said. “In some countries, broad coverage has been successfully accomplished through compulsory workplace pension systems or, in some cases, auto-enrolment arrangements.”
“However, with changes in the way people are working around the world, we need to ensure these schemes include everyone so that the whole workforce is saving for the future. This includes contractors, self-employed, and anyone on any income support, be that parental leave, disability income or unemployed benefits,” Knox said.
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