Lessons from the UK: When Multi-Pillar Pension Systems Meet Flexible Labour Markets

Abstract

The British pension system represents an interesting case for testing the capacity of public and private programmes to provide security in old age for both standard and non-standard workers.1 Britain has a multipillar pension system that it is based on the complex articulation of public and non-public retirement schemes. Moreover, the British pension system is embedded in a liberal market economy with a largely deregulated labour market. Such a multi-pillar system does not provide a high level of protection against old age risks for everyone. As Bridgen and Meyer (2007) argue, the British system consists of low public benefits and a mature but heterogeneous occupational and personal pensions sector built on voluntarism. The weaknesses in the British system have led some authors to speak of a ‘pension crisis’ (Pemberton, 2006; Ring, 2005), while others have said British pensions are in a ‘sorry state’ (Whiteside, 2006). Keywords Pension System Pension Scheme Public Pension Employment Protection Legislation Occupational Pension