Dec. 6, 2017
The average retirement age will rise about two years over the next four decades among members of the Organization for Economic Cooperation and Development (OECD), thanks to efforts in past years to shore up state-funded pension schemes.
The greatest projected jump will be in countries such as Denmark, Italy and the Netherlands where the retirement age is now linked to life expectancy.
Only five members - including France - of the OECD's 35 will have standard retirement ages below 65 by 2060.
Canada has been among the most active on the pension front.
Plans to increase the retirement age from 65 to 67 were cancelled under the new Liberal government in Ottawa. As a result, the retirement age for the full pension will remain at 65, while it will increase by just shy of two years from about 64 to 66 by 2065, on average, across the OECD, says the latest annual report by the Paris-based think-tank.
Denmark, Italy and the Netherlands will have a retirement age at 68 or higher based on current legislation.
At the same time, Canada will be aging at a pace similar to that of the average OECD country, says the annual report. So the number of people older than 65 per 100 people of working age (20-64) will increase from 26 in 2015 to 48 in 2050 in Canada, compared to 28 and 53 on average in the OECD.
Canada is among the three OECD countries who backtracked from planned increases in retirement age, along with the Czech Republic and Poland.
More changes to the CPP are coming soon. In 2016, Ottawa announced an "enhanced" CPP that will increase benefits paid out - although many years down the road - through an increase in contributions over five years starting in 2019.
Meanwhile, future pensions from mandatory schemes will increase. The future net replacement rate from mandatory schemes for a fullcareer average-wage worker will increase by about 10 percentage points to 53 per cent compared to 63 per cent on average in the OECD.
The cost of public pensions will continue to grow in some of the OECD's largest economies, such as the U.S., though the rate of growth will be slower than in the past two decades. Some countries will see drops, especially Greece, which slashed pension rights during the financial crises.
In its annual report on pensions, the OECD warns that members should take further steps to shore up pension systems to cope with demographic changes, greater inequality among senior citizens, and the changing nature of work in a digital economy.
With many people switching to non-traditional jobs, a strict fixed retirement age may no longer be in the general interest, it says.