Australian Retirement System

November 8, 2010

Australian Retirement System No Longer 2nd Place in World

According to the Mercer Global Pension Index 2010, Australia has fallen from second to fourth place in the world’s most efficient pension systems. The index ranks the pension and retirement systems of 14 countries based on adequacy, sustainability and integrity. Whilst the index value for Australia fell from 74.0 in 2009 to 72.9 in 2010, the reason for the drop in ranking was partly due to the inclusion of three new countries, including Switzerland now ranked in second place.

As Australia’s ranking is under 80.0 it is classed as B-grade, however, improvements including increasing the superannuation guarantee (SG) from 9 to 12 percent, reducing costs to members of funds and introducing a requirement that part of the retirement benefit be taken as an income stream could all help increase the Australian ranking. None of the countries surveyed achieved an A-rating, and China with a score of 40.3 came in as the lowest.

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