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Is There A Pensions Crisis In The Uk?

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  • E Philip Davis

Abstract

The UK pension system is traditionally seen as offering a good example to other countries, having features such as a low social security burden of the public sector as well as a high coverage of well-financed voluntary private schemes. But recent developments suggest that the model has shown weaknesses. The most pressing current issue is underfunding of defined benefit occupational schemes following the bear market; but there are also the ongoing crises of mis-selling of personal pensions and the failure of Equitable Life insurance company. In this paper we seek to investigate whether there is indeed a crisis and what the locus of the true crisis is. We find that there are important longer-term weaknesses of the UK system as well as these current difficulties, focusing on social security as well as private pensions. Pitfalls faced by UK policymakers offer important lessons to other countries seeking to set up or expand private pension provision.

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  • E Philip Davis, 2003. "Is There A Pensions Crisis In The Uk?," Economics and Finance Discussion Papers 03-21, Economics and Finance Section, School of Social Sciences, Brunel University.
    • Handle: RePEc:bru:bruedp:03-21
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    1. Miles, David, 1993. "Testing for Short Termisn in the UK Stock Market," Economic Journal, Royal Economic Society, vol. 103(421), pages 1379-1396, November.
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    Cited by:

    1. Michiel Bijlsma & Cora Zonderland & Machiel van Dijk & Marc Pomp, 2005. "Competition in markets for life insurance," CPB Document 96, CPB Netherlands Bureau for Economic Policy Analysis.
    2. Bill Martin, 2020. "Resurrecting the UK Corporate Sector Accounts," Working Papers wp519, Centre for Business Research, University of Cambridge.
    3. Francesco Macheda, 2018. "The illusion of patient capital: evidence from pension investment policy in the Netherlands," Working Papers 0029, ASTRIL - Associazione Studi e Ricerche Interdisciplinari sul Lavoro.
    4. Miguel Sanchez-Martinez & Philip Davis, 2014. "A review of the economic theories of poverty," National Institute of Economic and Social Research (NIESR) Discussion Papers 435, National Institute of Economic and Social Research.
    5. Machiel van Dijk & Michiel Bijlsma & Marc Pomp, 2008. "The price of free advice," Applied Economics, Taylor & Francis Journals, vol. 40(14), pages 1889-1903.
    6. Michiel Bijlsma & Machiel van Dijk & Marc Pomp & Cora Zonderland, 2005. "Competition in markets for life insurance," CPB Document 96.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    7. Christine Lagoutte, 2006. "Financement des retraites par capitalisation et équilibre des systèmes financiers : le cas du Royaume-Uni," Revue d'Économie Financière, Programme National Persée, vol. 86(5), pages 331-362.
    8. Kaifala, Gabriel B. & Paisey, Catriona & Paisey, Nicholas J., 2021. "The UK pensions landscape – A critique of the role of accountants and accounting technologies in the treatment of social and societal risks," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 75(C).
    9. Guillen, Montserrat & Jorgensen, Peter Lochte & Nielsen, Jens Perch, 2006. "Return smoothing mechanisms in life and pension insurance: Path-dependent contingent claims," Insurance: Mathematics and Economics, Elsevier, vol. 38(2), pages 229-252, April.
    10. Davis, E. Philip & De Haan, Leo, 2012. "Pension fund finance and sponsoring companies," Journal of Pension Economics and Finance, Cambridge University Press, vol. 11(3), pages 439-463, July.
    11. Machiel van Dijk & Michiel Bijlsma & Marc Pomp, 2006. "The price of free advice," CPB Discussion Paper 66, CPB Netherlands Bureau for Economic Policy Analysis.

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