Canadian pensions score high worldwide

Canada’s retirement income system ranks fourth in a global pension index comparing private and public pension systems in 11 countries.

The index, produced by consulting and investment firm Mercer, considers factors including the adequacy of benefits — or how much income is available to a retiree, the participation in private pension plans and the level of pension assets (as a percentage of GDP). While the Canadian system appears strong compared with many other countries, the report concludes there is still room for improvement and cites the following recommendations: increase the level of coverage of employees in occupational pension plans, possibly through a more efficient system; introduce mechanisms to ensure voluntary retirement savings are preserved for retirement purposes and to increase the pension age as life expectancy continues to increase, and increase the level of household savings.

“The fact that no country achieved an A-grade classification [a score greater than 80] confirms that no one system is perfect or currently robust enough to withstand the challenges presented by an aging population,” says Mercer’s David Knox, who oversaw the study.