For the first time in its history, pension recipients in the U.K. are no longer ranked in the top 10 in the world. The list prepared by Melbourne Mercer Global Pension Index has dropped the United Kingdom from 9th place to 11th place. The index looks at pension schemes by public and private institutions in 27 countries. The report stated that pensioners in U.K. will now receive less in relation to their wage, than what they did a year ago. One major cause of this is the ageing population. The low interest rates being offered in U.K. and many countries in the west haven’t helped matters either. The country got a score of 60.1 out of 100, for a C+, down from the 65.0 it received last year, for a B grade. While the pension scheme is still one of the best globally, it is in need of major improvements, as the risks of a system-wide failure are too high.
Denmark came out first overall, followed by Netherlands. The slip for the U.K. comes despite the new flat rate introduced by the government in April. Now, pensioners can expect £155.65 a week, as opposed to the previous rate of £119.30, though that had extra perks. However, depending on their years of service and employment status, some will get significantly more, and some less. A spokesman for the Department of Works and Pension said “Our pension reforms are all about creating a system that is simpler and easier to understand. Millions stand to gain from the changes to the state pension, including women and the self-employed, who so often have lost out in the past. Combined with auto enrolment and the news that by 2020 over 10m people are expected to be newly saving or saving more as a result of the policy, we are creating a fair and sustainable system for future generations.”