Recent OECD statistics have cast a dark shadow over the aspirations of private pension savers. Over the last 5 years, real returns from private pension funds after inflation have been negative in many EU Member States. They have failed to hold their purchasing power, setting a gloomy outlook for tomorrow’s pensioners. However, the OECD research on real returns only covers pension funds; it does not cover all costs or the impact of taxation. The report also does not include individual pension savings products (Pillar 3) and neither does the report cover OECD member France.
The OECD report presents a paradox to policy makers. The research of EuroFinUse on private pension returns shows that net returns to savers are often even less than the OECD data would suggest. In addition, medium term outlook is for this trend to continue and probably deteriorate further, as financial repression is at work against EU pension savers.
Date: 20th June 2013
Author: EuroFinUse
Type: Research papers
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