Yahoo Finance UK retirees receive lowest pensions in the developed world
Pensions in the UK are the least generous in the developed world, new analysis shows.
Workers earning the average £26,500 salary can expect to be paid less than a third of that – about £122.30 a week – on retirement.
That level of 29% is below the likes of Mexico, Poland and Chile and well under the world average of 63%.
MORE: Two out of three UK pension schemes are in the red to the tune of £210bn
The pension rate was assessed by the Organisation for Economic Co-operation and Development (OECD).
It reports that in contrast to the UK, Holland replaces 100% of a typical worker’s wage when they retire.
Portugal, Italy and Austria pay above 90% of a worker’s salary on retirement, while in France it is 74.5%, Germany 50.5% and the US 49.1%.
Pensions and retirement pots have been a hot political potato for years, with a succession of reports warning millions of people in the UK are set for a tough time in their twilight years.
MORE: 1 in 8 workers thinking of quitting their pension scheme
Few have saved anywhere near enough to supplement their state pension. Young people setting out on their working lives today are also facing the prospect of having to work well into their 70s before they can quit.
From later this year, the state pension age for women will rise from 63 to match men at 65, and will reach 66 for both by 2020.
The government’s economic forecasters, the Actuary’s Department, believes it will become 70 in the 2050s and 71 in the 2060s.
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Former pensions minister Baroness Altmann said: “Those with no other private pension or savings will face a much bigger drop in spending power than pensioners in all other countries.
“What’s even more shocking is that the Government Actuary says the costs of paying UK state pensions are unaffordable.
“In the past, our low state pensions were supplemented by generous final salary-type pensions from employers, or by an earnings-linked part of the state pension.”
