The 2019 edition of Pensions at a Glance highlights the pension reforms undertaken by OECD countries over the last two years. Moreover, two special chapters focus on non-standard work and pensions in OECD countries, take stock of different approaches to organising pensions for non-standard workers in the OECD, discuss why non-standard work raises pension issues and suggest how pension settings could be improved.
This edition also updates information on the key features of pension provision in OECD countries and provides projections of retirement income for today’s workers. It offers indicators covering the design of pension systems, pension entitlements, the demographic and economic context in which pension systems operate, incomes and poverty of older people, the finances of retirement-income systems and private pensions.
Key findings for Australia:
- While contributing to superannuation funds is nearly universal among employees, only 27% of the self-employed made contributions in 2016-17.
- Full career self-employed workers will have a pension equivalent to 90% of that of full career employees despite not having made any pension contributions.
- Relative incomes of those aged over 65 to the total population are low at 72% compared to the average of 87%, while poverty rates for the elderly are very high in Australia at 23%, ten percentage points above the average. As Superannuation funds can be taken as a lump sum, this might skew these figures.
- Replacement rates in Australia are lower than the OECD average. The future net replacement rate for a full-career male (female) average-wage earner is 41% (37%) compared to 59% (58%) for the OECD. With the relatively high value of the Age Pension this improves to 76% (72%) or low earners compared to the average of 68% (68%).
- Five-year breaks in the career for childcare or unemployment lower future replacement rates by 12%, much higher than the OECD average of 4% and 6%, respectively.