Abstract
Inevitably, there has been considerable disagreement around the means by which unsatisfied need should be addressed. Classical liberals insist that such action should be voluntary, confined only to philanthropic and charitable effort. But egalitarian liberals are highly tolerant of state involvement in directing ameliorative transfers to those at the bottom of society. Accepting the principle of compulsory collective responsibility for the worst-off, our analysis evaluates several models for the design of the first pillar retirement income safety-net. Selective social security programmes target financial assistance on the poor, but are blighted by low take-up and parsimonious benefit entitlements. While they appear to waste scarce resources, universal first pillar pensions maximise the flow and generosity of transfers to the least advantaged.
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Notes
- 1.
Echoing Doyal and Gough’s “thick” conception of need (1991), the term “primary goods” refers to a range of assets and opportunities that are vital to autonomy: “natural primary goods”—physical and psychological capacities; and “social primary goods”—resources and opportunities, including designated liberties, income, and wealth (Rawls 2003).
- 2.
Defined as household income below 50 percent of the median income for each country included in the study (Korpi and Palme 1998).
- 3.
This means of course that Meyer and her colleagues are concerned with the performance of the retirement system as a whole, which includes, but is not exhausted by the first pillar retirement income safety-net.
- 4.
On the basis of entitlements conferred by different elements of the retirement system (Meyer et al. 2007).
- 5.
The poverty threshold was defined as 40 percent of average earnings.
- 6.
- 7.
A 1994 study of Chile’s “Welfare Pension” (Valdés-Prieto 2002) found that around 60 percent of beneficiaries did not belong to households in the bottom quintile of the income distribution; while many recipients were in the top two quintiles. It has similarly been estimated that 40 percent of beneficiaries in Costa Rica’s social assistance safety-net belonged to households classified as “non-poor”; while 32 percent of the financially impoverished failed to qualify at all (Durán Valverde 2002).
- 8.
It may well be, as some have suggested (Williams 1990), that the nation state is an outmoded unit of political sovereignty, and that publicly managed services and income transfers should be accessible to citizens of “the world”. But for the time being, the nation state remains the most prevalent form of political organisation.
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Hyde, M., Shand, R. (2017). Need and Just Pension Design. In: Retirement, Pensions and Justice. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-137-60066-0_2
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