Pensions and old age poverty

In principle, pension policy can provide security for older people who are in danger of falling into poverty. This paper argues that if the international community is serious about tackling old- age poverty, a social pension is the best answer we have.

The document indicates that in countries where older people cannot access a pension, most of them need to work, while the poor health and disability they may suffer from have ramifications for their income.

Findings contain:

• public pensions have a major impact on old- age poverty ? they give older people more choice about whether to work
• pensions that benefit the vast majority of older people are more likely to be sustainable than poverty- targeted safety nets
• however, low benefit values or narrow coverage can decrease the positive impact on poverty

Conclusions are that:

• in developing countries, it is evident that non-contributory pensions with very broad coverage among the older population (i.e. social pensions) can have significant impacts on old- age poverty
• indeed, the need for social pensions will increase as populations age, and putting comprehensive social pensions in place now will enable countries to prepare for the future

The authors emphasise that tackling old- age poverty must be an important part of achieving the Millennium Development Goals (MDGs). Yet, ensuring access to pensions for older people is the best contribution that pension policy can make to these objectives.