This is apparent from an overview by HR and pension advisor Mercer. For almost a decade, the Netherlands and Denmark battled for the top spot in the Mercer ranking.
Last year, the Netherlands was still proudly at the top, ahead of the Danes. But both countries now have to give way to the Icelanders and that while Mercer includes that country in the comparison for the first time. “They come in at number one by far,” said Mercer pension expert Marc Heemskerk.
We still score an 8
The Icelandic pension system scores even better than ours because relatively more people over 55 are working there, says Heemskerk. “If you work, you can build up more pension for yourself and contribute to the state pension, which we call AOW. If you don’t work, you don’t pay AOW premiums either.”
Furthermore, household debt in Iceland is somewhat lower than in the Netherlands, says Heemskerk. As a result, Icelandic retirees have less debt to pay and can spend more on other things, he says. Moreover, the population structure in Iceland is more favourable, so that there will soon be more residents to pay AOW contributions, explains Heemskerk.
“Our pension system continues to score well compared to other countries, he says. “We are one of only three countries in the world to score an ‘A’, or an eight or higher.”
‘Less discount threat’
Because share prices have been rising for some time and market interest rates are also rising somewhat, the threat of cuts has passed for most pension funds, he says. “There are even pension funds that are going to increase pensions, so I see a cautious sun.”