Academic journal article Population

Effects of Pension Reforms on Gender Inequality in France

Academic journal article Population

Effects of Pension Reforms on Gender Inequality in France

Article excerpt

In most countries, women receive lower retirement pensions than men. For example, their average pension is 37% lower than men's in Spain (Ministerio de trabajo y asuntos sociales, 2002), 40% lower in the UK (Department for Work and Pensions, 2005) and 37% lower in Sweden (Statistics Sweden, 2004). In France, the difference is 42%. The differences would be even larger if only the rights accruing from employment were considered. In fact, a substantial proportion of women's total pension receipts are in the form of survivor's pensions(1), paid out in the event of a spouse's death. In France, for instance, women's own pensions are 53% lower than those of men (Coëffic, 2002). In systems that link pension rights to employment - however closely or loosely - the gaps relate to observable differences in the labour market: both in participation rates and in wages (Ponthieux and Meurs, 2004). For women, lower pension entitlements and the greater likelihood that they will live alone during their retirement result in a higher poverty risk (Winqvist, 2002; Cohen-Solal and Lelievre, 2003). However, thanks to women's increased participation rates, a reduction in wage differentials and the existence of various provisions of a redistributive nature from which women - either by right or de facto - benefit more fully, prospective studies conclude that pension differentials between men and women will be reduced in the future (Levine et al., 1999), though they may remain considerable (for France, see Bardaji et al., 2002; Bonnet and Colin, 2000; Bonnet et al., 2006).

Faced with problems in the long-term financing of their pension systems, many European countries have for some years been undertaking reforms (Math, 2001; Chagny et al., 2001 ). Whatever the precise arrangements, the general trend is towards a lowering of the replacement rate (Chagny et al., 2001 ; Palier, 2003). In spite of women's less favourable position, and the abundance of literature on the pension reforms, the issue of gender is virtually absent (Ginn et al., 2001; Ginn, 2003)(2). Nevertheless, a growing number of studies are devoted to changes in the pension rights respectively of men and women, and to the role played by the reforms in these changes. In other words, these studies are trying to determine how far the effects of the reforms may differ between the sexes. Falkingham and Rake (2001), for example, have analysed the provisions introduced from 1998 in the United Kingdom (DSS, 1998). Veil (2000 and 2001 ) has similarly examined the German reforms of 2000 and 2001, while Fultz et al. (2003) have investigated how the profound changes in pension systems in the countries of eastern Europe have affected the two sexes differently.

In France, the discussions surrounding the 2003 pension reform have revealed concern about women's future entitlements (Assemblée Nationale, 2003; Meron and Silvera, 2004). While the pension differences between men and women are being reduced over time, the changes are particularly slow for the cohorts now coming up to retirement. In 2001, retired women aged 65 to 69 received total pensions that were on average 45% lower than those of men of the same age (Coëffic, 2002).

Following the pattern of previous studies, this paper deals with the effect on gender inequalities of the basic pension reforms introduced in France from the early 1990s. Although the reforms do not include specific provisions for each sex, their consequences may be affected by differences in the typical employment histories of men and women. The effect of the reforms implemented in 1993-94 and 1996 for complementary pension systems will not be dealt with in this paper. While those reforms will lower the income replacement rate for those retiring in the future (COR, 2001), it does not seem from initial scrutiny that their effect will differ between the sexes. In this paper, we study the effect of the reforms adopted in 1993 and 2003 for men and women born between 1965 and 1974. …

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