Ashgate, 2013, 1 4724 1697 1, pbk, 701 pp, £75
The question that this book tackles is an important one: How can developed countries afford pensions for an ageing society when more people are putting in fewer years of paid employment?
Part I or this substantial volume is full of detailed and diagrammatic description of the demographic and financial situation faced by state pensions (particularly in Austrian, which is the focus of attention, but also in other developed countries). The initial conclusion is that a pay as you go state pension is the only viable financial bedrock for the elderly, that men’s and women’s retirement ages should be equalised, that each individual’s retirement age should be flexible, and that a lifetime approach should be taken: for instance, making it possible to take paid sabbaticals and then to be gainfully employed after what we might now call the state retirement age.
In part II Marin recommends a ‘notional defined contribution’ (NDC) system – that is, a state pay as you go system that mimics a funded defined contribu-tion pension, i.e., each individual builds up a notional account that is then turned into a pension based on age at retirement and the number and amounts of contribut-ions, as a funded defined contribution pension would be. Credits are attributed for child-rearing years and other contingencies: so the UK’s current Basic State Pension and State Second Pension together look like a rather haphazard version of NDC.
Part III calls for disability benefits that do not alter with employment status because employment should always be an option and there should be every incentive to seek it (p.428); and Part IV discusses the greater diversity of employment patterns experienced by women as compared to men, and wonders about how to recognise this in state pension schemes.
At over 700 pages this book is far too long. It’s like a holdall into which Marin has thrown the workings and the results of his own and others’ researches. Each section, and the book as a whole, could have done with some drastic editing (with perhaps many of the tables and graphs being made available on a website). Sadly, there is no index, which one would have thought essential in such a vast volume as this. But having said that, the book is of considerable interest, and it tackles some vital questions.
An abiding impression is that in each section the argument leads in the direction of increasing unconditionality and universality (particularly because that would facilitate a flexible retirement age, and would incentivise employment at all ages, particularly for people with disabilities), but that is not where the concluding sections end up. A further book would be of value: more concise, more tightly argued, and with an overall theme: to test the hypothesis that the situation outlined in part I of the book demands a Citizen’s Pension for elderly people and a Citizen’s Income for working age adults.