How does Britain's pension predicament compare with other countries
The work and pensions secretary said the government is setting out to 'tackle the barriers that stop too many saving in the first place' after her department found that people retiring in 2050 are on track to be poorer than those retiring today, expecting to get £800 less in private pension income.
Currently, just 55 per cent of working age adults in the UK are contributing to a pension pot, and MPs have said that a UK-wide strategy is needed to address pensioner poverty.
But the UK's pension dilemma is not unique. Countries across the world are grappling with similar looming crises, driven by a combination of factors including demographic shifts, low interest rates and economic instability.
Here, the Independent takes a look at what action other governments are taking to stave off the impending crisis.
United States
In the United States, half of all private-sector workers are unable to get a retirement plan through their jobs, according to a survey published in June by Pew Charitable Trusts.
The US's most common workplace retirement plan is a 401(k), which allows employees to voluntarily put money aside for retirement which is typically matched by their employers. The total employee and employer contributions to a 401(k) cannot exceed $70,000 per year.
Around 27 per cent of Americans over the age of 59 have no savings to rely on in their retirement, according to a survey by financial services firm Credit Karma in 2023.
Last week, the Wall Street Journal reported that the Trump administration was expected to sign an order that would open up 401(k)s to the private markets.
It would order the US Labor Department and Securities and Exchange Commission to create guidance for employers on including private assets in 401(k) plans, which could, in turn, create more investment opportunities for them.
Canada
Currently, the key challenge for many countries remains the low rate of pension saving.
More than half (59 per cent) of working Canadians do not believe they will have enough money to retire, according to a survey conducted this year by Canadian pension fund HOOPP, Healthcare of Ontario Pension Plan.
However, Canada is tackling this through rate increases within their savings system.
The government has expanded the Canada Pension Plan (CPP), a monthly benefit that replaces a percentage of a person's income after they retire.
Between 2019 to 2025, it has increased the percentage of how much of a worker's earnings are replaced from 25 per cent to 33.33 per cent.
It has also increased the maximum level of earnings protected by the CPP by 14 per cent over 2024 and 2025.
Australia
Australia is recognised as having one of the world's top pension schemes where employers are required to pay a percentage of their employees earnings into an account which that employee can then access once they have retired.
As of this month, employers are now required to contribute 12 per cent to employees' retirement savings accounts, up from 11.5 per cent.
They are also taking steps to close the gender pension pay gap with the Labor Government introducing a superannuation top up for parents taking time off to care for a newborn.
The CityUK CEO Miles Celic said: 'total contributions will have to rise if we are to emulate the successes of, for example, Australia and Canada.
'This will involve difficult political choices alongside technical changes to policy and regulation.'
France
In 2023, French President Emmanuel Macron raised the age of retirement from 62 to 64, which sparked massive public backlash and protests.
Macron's administration argued that the reform was essential to prevent long-term deficits in the pension system.
At the time, Macron said he did not enjoy passing the reform but called it a necessity, saying 'the longer we wait, the more (the deficit) will deteriorate.'
As well as increasing the age of retirement, France has also hiked the minimum contributory requirements by 2 per cent this year across all bands.
The minimum contribution applies to retirement pensions under its Pension Insurance scheme.
In Germany, the retirement age is gradually being raised from 65 to 67. Like many governments across Europe, it is trying to reduce pressure on the pension system created by aging populations.
Last year, it approved pension reform and its new government has set out a series of policies that include maintaining the amount paid to retirees each month - which is 48 per cent of the average monthly salary.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
South Wales Guardian
8 minutes ago
- South Wales Guardian
First migrants detained under ‘one in, one out' deal as PM vows to secure border
Home Secretary Yvette Cooper said the Government was prepared to defend itself against legal challenges if migrants seek to avoid being sent back across the English Channel. The migrants detained were among those who risked the Channel crossing on Wednesday, the day the pilot scheme began operating. The first small boat migrants have been detained under our landmark UK-France returns deal. This is what happens next 👇 — Home Office (@ukhomeoffice) August 7, 2025 Prime Minister Sir Keir Starmer said: 'We have detained the first illegal migrants under our new deal before returning them to France. No gimmicks, just results. 'If you break the law to enter this country, you will face being sent back. When I say I will stop at nothing to secure our borders, I mean it.' The pilot scheme was set up as part of a deal announced by the Prime Minister and French president Mr Macron during his state visit to the UK in July. UK officials aim to make referrals for returns to France within three days of a migrant's arrival by small boat while French authorities will respond within 14 days. This is in exchange for an approved asylum seeker in France to be brought to the UK under a safe route. No figures have been confirmed for how many migrants will be sent back, although reports from France have suggested it could be around 50 a week, a small fraction of the numbers making the crossing in small boats. The Home Secretary said: 'The pilot has now begun, so the first migrants who have arrived on the small boats are now in detention. We will then swiftly make the referrals to France and that process will now start to be able to return people to France. 'It's the beginning of the pilot and it will build as well over time, but we're also clear that France is a safe country, so we will robustly defend against any legal challenge that people try. 'We do expect for people to start being returned in a matter of weeks.' The Home Office is expected to launch a campaign in the coming days to make migrants in northern France and elsewhere aware of the new treaty. Ms Cooper added: 'Criminal gangs have spent seven years embedding themselves along our border and it will take time to unravel them, but these detentions are an important step towards undermining their business model and unravelling the false promises they make.' The Home Secretary has acknowledged the accord is not a 'silver bullet' to stop small boat crossings, which are running at record levels so far in 2025. But the Government hopes it will be a turning point as migrants will be sent back across the Channel for the first time. The process for asylum seekers to come to the UK under the 'one in, one out' pilot scheme has also been launched, with adults and families in France able to express an interest in coming to the UK through an online platform set up by the Home Office. They will have to meet suitability criteria, a standard visa application process and security checks. If accepted, they would be given three months in the UK to claim asylum or apply for a visa, and would be subject to the same rules for all asylum seekers not allowed to work, study or have access to benefits. Shadow home secretary Chris Philp said just a 'token handful' of migrants had been detained and suggested the pilot scheme would fail. He said: 'Keir Starmer's promise last year to 'smash the gangs' has turned out to be nothing more than a gimmick that didn't work, and this is just the same. 'They are detaining a token handful of arrivals and in return we accept unvetted migrants from France. The whole thing is riddled with loopholes, opt-outs and legal escape routes that will make removals near-impossible.'
The Independent
8 minutes ago
- The Independent
Jess Phillips slams ‘idiot' councils for denying grooming gang threat
Jess Phillips has condemned 'idiot' councils that believe there is no grooming gangs problem, before asserting that Elon Musk did not influence the decision to hold a national inquiry. Speaking to Sky News on Wednesday (6 August), the safeguarding minister said that she 'doesn't care' whether local authorities support the inquiry, which was announced in June following a 'damning' audit into the scandal from Baroness Casey. When told by the broadcaster that she'd 'surprised' at how many areas believe they have no issue with gangs, she responded: 'Well, they [the councils] are idiots if they say that'. She added: "I don't follow Elon Musk's advice on anything', after the SpaceX founder called on the UK to host a new public inquiry amid a series of inflammatory posts against Phillips. 'Before anyone even knew Musk's name, I was working with the victims of these crimes.'
The Independent
8 minutes ago
- The Independent
China's exports and imports picked up in July, helped by the pause in Trump's higher tariffs
China 's exports surged 7.2% in July from a year earlier while its imports grew at the fastest pace in a year, as businesses rushed to take advantage of a truce in President Donald Trump' s trade war with Beijing. However, analysts said the improvement also reflected a low base for comparison in July 2024. Exports to the United States sank nearly 22% year-on-year, while imports from America fell almost 19%. But exports to Africa and Southeast Asia surged at double-digit rates as Chinese businesses diverted sales to other markets. Tariffs on Chinese goods are being considered separately from the new higher tariffs that took effect on Thursday for dozens of U.S. trading partners. China's global trade surplus for 2025 rose to $683.5 billion by the end of July, nearly a third higher than the surplus for the same period last year. The data showed that China's surplus in July was $98.2 billion, while its exports to the United States were $23.7 billion than its imports of U.S. goods. U.S. imports from China are subject to tariffs of at least 30%, with some products facing much higher import duties. Trump earlier had ordered still higher rates of up to 245%, and Beijing responded in kind, but the two sides agreed to pause those to allow time for trade talks. It's unclear if the truce will be extended beyond an Aug. 12 deadline following the latest round of negotiations last week in Sweden. The Trump administration has also raised tariffs on imports from countries other than China that it suspects of being 'transshipped" via other countries. For example, the import duty on Vietnam's exports to the U.S. now stands at 20%. For transshipped goods, it's 40%. 'With the temporary boost to demand from the U.S.-China trade truce already fading and tariffs on shipments rerouted via other countries now rising, exports look set to remain under pressure in the near term,' Zichun Huang of Capital Economics said in a report. Economists had been expecting China's dollar-denominated exports to grow less than 6% in annual terms in July, on a par with June's 5.8% rate. But improved trade with the rest of the world has helped offset the impact of Trump's trade war. Imports rose 4.1% last month from a year earlier, the most since July 2024, with higher shipments of crude oil, copper and soybeans. China's exports of rare earths that are vital for making many high-tech and other products and Trump has made ensuring U.S. access to such vital minerals a key part of trade negotiations, leading Beijing to promise to loosen some controls. In July, China's exports of rare earths fell 17.6%, compared with a nearly 50% fall the month before. In January-July, its rare earths exports fell 24.2% in dollar terms although they rose more than 13 percent by volume. Exports of vehicles, fertilizer, ships and auto parts also saw strong growth.
