Geen diatitel

1
Turning Boomers into Boomerangs? Policies and
Preferences in the Netherlands
Ernst van Koesveld, Ministry of Finance, the
Netherlands
International Forum on Pension Reforms, June 7-9,
Slovenia
2
(No Transcript)
3
Main messages

• Employment rates women make the difference
• Policies be aware of endogenous preferences
• Do not overestimate the impact of financial
  incentives
• But recognize the impact on preferences in longer
  term
• Key change peoples perspectives on working
  longer
• Reminder voters are ageing too!
• I

4
OECD Total
OECD 55-64
5
(No Transcript)
6
(No Transcript)
7
Policy response 1995-2005

• Government was fighting its own success!
• Agreements with social partners in 1997 and 2004
• PAYG early retirement ? capital funded and
  actuarially neutral pre-pensions
• Tax deductibility abolished
• Transition period
• Waterbed-effect
• But still unemployment tunnel
• Average exit age 59.5 in 1993 ? 61 in 2006
• 2nd pillar final pay ? career-average pay

8
Market for older workers

• Labour supply preferences (personal wealth)
  discouraged worker effect early exit routes
  remain attractive

9
Older population and labour market
10
Market for older workers

• Labour supply early exit routes remain
  attractive preferences (personal wealth)
  discouraged worker effect
• Labour demand preferences (discrimination)
  statistical discrimination discrepancy
  wage-productivity

11
(No Transcript)
12
Market for older workers

• Labour supply early exit routes remain
  attractive preferences (personal wealth)
  discouraged worker effect
• Labour demand discrepancy wage-productivity
  statistical discrimination preferences
  (discrimination)
• Internal and external labour market are not
  connected strict employment protection
  especially for older workers result well
  protected insiders and permanent outsiders

13
Key change peoples perspective
easy
easy

• Advocacy
• Exchange of best practices
• Life-long learning
• Positive fiscal incentives
• Reduce seniority advantages
• Active labour market policies (work-first)
• Curtail remaining early exit routes
• Reform employment protection
• Raise retirement age

hard
hard
14
Final considerations

• (fiscal) incentives may have limited impact in
  short term, but will support a change in
  preferences in the longer run
• equity considerations (life expectancy, type of
  work, private savings, etc.)
• political economy of reform voters age too!