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What Makes Pension Reforms Sustainable?


  • Aaron George Grech

    (Central Bank of Malta, Castille Place, Valletta VLT 1060, Malta)


Policymakers pushing pension reforms have tended to justify changes on the basis that they would make systems more sustainable by lowering future spending on pensions. This is a rather narrow interpretation of sustainability that fails to consider that other fiscal programs may need to accommodate the impact of reforms that reduce pension system adequacy. In this light, this article argues that in order to correctly assess the sustainability of pension reforms, one needs to adopt a more holistic framework that encapsulates the interaction between pension system goals and constraints. In a number of countries, reforms focused solely on reducing future spending were followed by reforms that restored generosity. A holistic approach to assess pension sustainability could help limit this cycle of reform and increase trust in pension systems.

Suggested Citation

  • Aaron George Grech, 2018. "What Makes Pension Reforms Sustainable?," Sustainability, MDPI, vol. 10(8), pages 1-12, August.
  • Handle: RePEc:gam:jsusta:v:10:y:2018:i:8:p:2891-:d:163868

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    References listed on IDEAS

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    4. Qing Zhao & Zhen Li & Yihuan Wang, 2019. "Adequacy Analysis of the Basic Old-Age Pension System Based on Local Administrative Data in China," Sustainability, MDPI, vol. 11(24), pages 1-18, December.
    5. Mel Cousins, 2021. "The sustainability of China’s Urban Employees’ Pension Programme: A case of getting old before getting rich?," International Social Security Review, John Wiley & Sons, vol. 74(1), pages 59-77, January.
    6. Said Outlioua & Abdesselam Fazouane, 2023. "Which factors affect the sustainability of pension schemes?," Economic Affairs, Wiley Blackwell, vol. 43(1), pages 89-108, February.
    7. Lorenzo Fratoni & Susanna Levantesi & Massimiliano Menzietti, 2022. "Measuring Financial Sustainability and Social Adequacy of the Italian NDC Pension System under the COVID-19 Pandemic," Sustainability, MDPI, vol. 14(23), pages 1-23, December.
    8. Jarmila Vidová & Peter Sika, 2020. "Christmas Allowance as a Non-System Tool for Sustainability of Quality of Life of Slovak Seniors," Sustainability, MDPI, vol. 12(9), pages 1-14, May.
    9. Huan Wang & Jianyuan Huang & Shuangyue Sun, 2019. "Assessment of the Financial Sustainability of China’s New Rural Pension Plan: Does the Demographic Policy Reform Matter?," Sustainability, MDPI, vol. 11(18), pages 1-22, September.

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