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Il pilastro privato del sistema previdenziale. Il caso del Regno Unito

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  • Francesco Spadafora

    ()
    (Banca d'Italia)

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    Abstract

    In striking contrast with the majority of other European economies, the UK pension system does not pose problems of financial sustainability to public finances. Public expenditure for pensions is foreseen to remain relatively stable for the next 50 years, around 5 percent of GDP, thanks to the considerable stock of privately-funded, actuarially-fair pension provision accumulated by the country, thus making the system (in government’s words) “a fair deal between generations”. Nonetheless, an intense debate is under way on the alleged crisis of the pension system, resulting not only from the private cost but also from the level of the benefits. The debate encompasses both the demand and the supply side of the pension system. On the one hand, the discussion focuses on the allegedly inadequate level of national savings, particularly by the population on lowest income, which would not produce in the future a level of pension high enough to guarantee an appropriate standard of living in retirement. On the other hand, the fall in equities in the period 2000-02 highlighted the fact that one of the main characteristics of the system, the prevalence of defined-benefit occupational pension funds, would act as a transmission channel of equity market shocks to the corporate sector of the economy. Moreover, in the light of the major role played by life assurances in the supply of pension products and growing interlinkages between the banking and insurance sectors, the financial soundness of life assurances takes on a particular relevance for the stability of the financial system as a whole. The present work illustrates the structural characteristics and significant peculiarities of the UK pension system, with particular emphasis on the evolution of pension savings in the private sector. Furthermore, it surveys the main aspects of the current debate and the different measures put forward as possible solutions. With reference to Italy, the UK experience may constitute a source of meaningful reflections for the current debate on the evolution of private pensions.

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    Bibliographic Info

    Paper provided by Bank of Italy, Economic Research and International Relations Area in its series Temi di discussione (Economic working papers) with number 503.

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    Date of creation: Jun 2004
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    Handle: RePEc:bdi:wptemi:td_503_04

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    Keywords: fondi pensione; previdenza privata; means-testing;

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    References

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    1. Anthony B. Atkinson & Andrea Brandolini, 2000. "Promise and Pitfalls in the Use of 'Secondary' Data-Sets: Income Inequality in OECD Countries," Temi di discussione (Economic working papers) 379, Bank of Italy, Economic Research and International Relations Area.
    2. Marchetti, D.J., 1999. "Markup and the Business Cycle: Evidence from Italian Manufacturing Branches," Papers 362, Banca Italia - Servizio di Studi.
    3. Lorenzo Forni, 2004. "Centralization of wage bargaining and the unemployment rate: revisiting the hump-shape hypothesis," Temi di discussione (Economic working papers) 492, Bank of Italy, Economic Research and International Relations Area.
    4. Cannari Luigi & D'Alessio G., 2002. "La distribuzione del reddito e della ricchezza nelle regioni italiane," Rivista economica del Mezzogiorno, Società editrice il Mulino, issue 4, pages 809-848.
    5. Domenica J. Marchetti, 1999. "Markup and the Business Cycle: Evidence from Italian Manufacturing Branches," Temi di discussione (Economic working papers) 362, Bank of Italy, Economic Research and International Relations Area.
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    Cited by:
    1. Pozzolo, Alberto Franco, 2004. "The Role of Guarantees in Bank Lending," Economics & Statistics Discussion Papers esdp04021, University of Molise, Dept. EGSeI.
    2. Alberto Franco Pozzolo, 2004. "Endogenous growth in open economies: a surveys," Temi di discussione (Economic working papers) 527, Bank of Italy, Economic Research and International Relations Area.
    3. Gabriele Semeraro, 2007. "Should financial accounts include future pension liabilities," IFC Bulletins chapters, in: Bank for International Settlements (ed.), Proceedings of the IFC Conference on "Measuring the financial position of the household sector", Basel, 30-31 August 2006 - Volume 1, volume 25, pages 179-198 Bank for International Settlements.

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