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The Role of Derived Rights for Old-age Income Security of Women

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  • Jongkyun Choi
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    Abstract

    1. This paper analyses the income situation of older women living alone and examines the role of pension entitlements from derived rights for their income security. The data shows that the share of elderly women living alone is expected to increase substantially due to population ageing and women’s longer life expectancy. Many of them are at greater risk of poverty than aged couples. Taking into account that poverty among older women living alone has been on the rise in many OECD countries, old age income security of widows and divorcees will remain a challenge for policy makers. 2. The analysis of income sources shows that survivors’ pensions and divorcees’ benefits form the largest share of the incomes of elderly women living alone. It also finds a relatively strong negative relationship between the size of the pension benefit and the poverty level of older women living alone. Thus, the structure and level of public pension schemes play an important role for income adequacy and poverty risks of this group. Most OECD pension systems offer protection for widows and divorcees through contributory or non-contributory benefits. Entitlements derived from the rights of an income-earning spouse are usually calculated as a percentage of the insured worker’s rights. Preliminary calculations show that in the OECD countries examined here, non-working widows and working widows receive an average pension level of 36 and 50%, respectively, compared to an average level for couples of nearly 60% of average earnings. 3. The high poverty rate of older women living alone suggests that survivors’ pension schemes or pension benefits for divorcees are not entirely successful in providing old-age income security for this target group. As an increasing number of women work and earn their own pension entitlements, derived pension rights may become less important. However, adequate pensions will require full-time work over the whole career. In countries where women work more part-time and experience longer career interruptions due to caring for children or elderly relatives, pensions based on own contributions may be quite low. Whether poverty prevention for this group is best addressed by benefits from derived rights or by the general old-age safety net will depend on the degree of full-time female labour force participation and the evolution of poverty of older women living alone relative that of the overall older population. 4. Ce document analyse la situation des revenus des femmes âgées vivant seules et examine le rôle des droits à pension provenant de droits dérivés pour leur garantie de revenu. Les données montrent que la part des femmes âgées vivant seules devrait beaucoup augmenter dans les années à venir à cause d’une population vieillissante et de la longévité plus importante des femmes. Beaucoup d’entre elles risquent plus d’être pauvres que les couples âgés. Si on tient compte du fait que la pauvreté chez les femmes âgées vivant seules ne cesse d’augmenter dans plusieurs pays membres de l’OCDE, faire en sorte que les personnes âgées veuves ou divorcées puissent jouir d’une protection de revenus restera un défi pour les pouvoirs publics. 5. L’analyse des sources de revenus montre que les pensions de réversion et les prestations des divorcées forment la plus grande partie des revenus des femmes âgées vivant seules. Elle montre aussi une relation relativement forte et négative entre l’ampleur des prestations de pension et le niveau de pauvreté des femmes âgées vivant seules. Aussi, la structure et le niveau des régimes de retraite publics jouent un rôle important pour faire en sorte que ce groupe de personnes ait suffisamment de revenus et qu’elles ne tombent pas dans la pauvreté. La plupart des systèmes de pension des pays de l’OCDE offrent une protection pour les veuves et les divorcées par le biais de prestations contributives ou non contributives. Les revenus perçus des droits d’un époux qui gagne un salaire sont normalement calculés comme un pourcentage des droits d’un travailleur assuré. Les calculs préliminaires montrent que dans les pays de l’OCDE examinés ici, les veuves qui ne travaillent pas et les veuves qui travaillent reçoivent un niveau moyen de pension de 36 et 50%, respectivement, comparé à un niveau moyen pour les couples de presque 60% des revenus moyens. 6. Le fort taux de pauvreté des femmes âgées vivant seules suggère que les régimes de retraite de réversion ou les prestations de pension pour les divorcées ne sont pas totalement une réussite pour assurer à ce groupe cible une garantie de revenus. Comme de plus en plus de femmes travaillent et gagnent leurs propres droits à pension, les droits à pension dérivés peuvent devenir moins importants. Toutefois, pour obtenir des pensions suffisantes il faudra travailler à plein temps pendant toute une carrière. Dans les pays où les femmes travaillent plus à temps partiel et où elles ont des interruptions de carrière plus longues pour s’occuper des enfants ou de parents âgés, les pensions basées sur les propres contributions peuvent s’avérer assez basses. Que les prestations provenant des droits dérivés ou des filets de sécurité des personnes âgées puissent prévenir au mieux la pauvreté dépendra du degré de participation des femmes travaillant à plein temps et de l’évolution de la pauvreté des femmes âgées vivant seules en comparaison avec la population âgée en générale.

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    Bibliographic Info

    Paper provided by OECD Publishing in its series OECD Social, Employment and Migration Working Papers with number 43.

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    Date of creation: 08 Dec 2006
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    Handle: RePEc:oec:elsaab:43-en

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    Cited by:
    1. LEROUX, Marie-Louise & PESTIEAU, Pierre & RACIONERO, Maria, 2009. "Voting on pensions : sex and marriage," CORE Discussion Papers, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) 2009057, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Patricia Peinado & Felipe Serrano, 2011. "A Dynamic Analysis of the Effect of Social Security Reform on Spanish Widow Pensioners," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 58(5), pages 759-771, December.

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