Eurostat pension visits to Member States – Major issues Pension Workshop 2014 Jens Grütz Eurostat C1

Preparing for the supplementary table on pensions Chapters 17 of 2008 SNA and ESA 2010 Technical compilation guide for pension data in national accounts Pension training Country visits – national experience Pension workshops

Country visits - Structure Institutional arrangements Data sources / major assumptions Filling in the supplementary table Sensitivity analysis for pension data Further guidance Exchange of experience Communication of pension entitlements

Institutional arrangements Various institutions concerned Government/enterprise acting as pension manager Explain national accounts needs Establish contacts on time Service agreements vs own calculations Final data transmission by National Statistical Institutes

Data sources / assumptions Overall: good data basis Problems: Back data for full working career; missing entitlement data (accrual rate); cross-border data Assumptions: Harmonised set of European macroeconomic and demographic assumptions Pension fact sheet explaining national data

Filling the supplementary table: Issues (1) Allocation of schemes to the columns of the table Coverage of the table Survivor pensions Disability pensions Rehabilitation etc. provided by pension insurance Modelling of complex pension reforms

Filling the supplementary table: Issues (2) Calculation of output Social security with separate unit; sum of cost; otherwise included in output of government Own employer scheme; sum of cost plus mark-up Employer uses insurance company; fee charged Multi-employer scheme; as for life-insurance * In case of not meaningful results; sum of cost plus allowance for 'normal profit'

Filling the supplementary table: Issues (3) Balancing the table; within a model or using different data sources Imputed contributions (reflecting experience effects as well) Identification of other changes Revaluations Discount rate Inflation rate ... Other changes in volume Updated mortality table …

Filling the supplementary table: Issues (4) Model Data Opening balance sheet 100 Transactions + Actual contributions 10 20 + Imputed contributions + Contribution supplements 5 - Pensions paid 15 Other flows + OCV (new mortality table) = Closing balance sheet 110 115

Update of the technical pension compilation guide Further guidance Update of the technical pension compilation guide Glossary More basic information More information on notional defined contribution schemes More information on defined contribution schemes More examples

General description of the scheme Assumptions and methodologies Pension fact sheet General description of the scheme Coverage of population, benefit formula Assumptions and methodologies Discount rate; indexation; ABO/PBO Data used to run the model Mortality tables, entitlement statistics, other data Reforms incorporated in the model Specific assumptions Modelling of careers, retirement behaviour, survivor pensions

Communication on pension entitlements Joint communication strategy Accrued-to-date pension entitlements are not an indicator for financial sustainability The results need proper explanations; explaining differences between countries Level of entitlements sensitive to changes in assumptions Supplementary table as important tool for the analysis of pension reforms

The members of the pension workshop are invited to comment on the draft pension fact sheet; comment on the pension compilation guide identify further elements for the future communication of accrued-to-date pension entitlements. Thank you for your kind attention