UK behind Canada and Germany in global pensions index

The UK has been ranked 15th in a global pensions index

THE UK has been ranked 15th in a global pensions index, which rates countries on how well-prepared they are to face the challenges surrounding people living for longer.

The Netherlands was ranked first out of the 34 countries looked at, with Denmark second.

Both countries were described as having an "A-grade" robust, sustainable retirement income system, delivering good benefits.

The UK, which was graded "C-plus" in the pensions index, was placed behind countries including Australia, New Zealand, Canada and Germany in the overall rankings, but above France, the United States, Spain and Italy.

The report was published by the Australian Centre for Financial Studies in collaboration with consulting firm Mercer.

The Melbourne Mercer Global Pension Index was compiled looking at factors such as how countries' pensions systems are designed, the contributions being put into savings pots and pensions regulation, communications and costs.

Mercer said the UK's score in the index has improved compared with 2017 as automatic enrolment into workplace pensions progresses.

But it said the UK continues to be weighed down by factors including relatively low levels of provision offered to the less well-off and the self-employed.

Brian Henderson, a partner at Mercer, said: "The UK scored well on the integrity of its pension system, with a sound approach to regulation and governance, but must take action now to increase provision for low earners and the self-employed."

He said the position will improve as minimum contribution rates into workplace pensions increase, with a further rise set to take place in 2019.

Mr Henderson continued: "More widely, with a tight labour market, employers should attract and retain talent by improving workplace pension schemes.

"This can improve the financial well-being of employees and create a more productive workforce."

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