Pension provision in the farming sector – Lessons from Europe
Hana Hlochova, Bridget McNally, Michael T. Hayden, Anne Kinsella
Abstract
Pension security for the self-employed within the EU has been improved by recent pension reforms, nevertheless gaps persist, and the self-employed remain a vulnerable group in this regard. The self-employed in Ireland overall have lower levels of pension in comparison to those in employment and self-employed farmers have the lowest pension cover with many not planning to ever retire. This is despite the fact that self-employed farmers predominantly begin their working life earlier and spend a longer time in employment than the employed. The objective of this study is to assess the design of the social security pension system for farmers in five countries which have bespoke social security pension systems for farmers, to identify gaps in the current Irish social security pension system for farmers and highlight the need internationally for a bespoke system for farmers. The five countries examined, (Austria, Finland, France, Germany, and Poland) are members of the European Network of Agricultural Protection Systems (ENASP) which focuses on a broad spectrum of social security issues. Retirement pensions is one of its key areas of interest and thus the pension systems of these five countries provide an important benchmark for international comparison. In the Irish context, the findings suggest that Ireland lags in terms of its social security pension system, as it applies to farmers. Reform is needed to ensure full social welfare pension coverage for this cohort to protect their financial welfare in retirement and to support the farm succession process. We suggest some practical solutions in this regard. • Concerns exist about the economic sustainability of an aging farming population in Ireland and many other OECD countries. • Under current pension policy in Ireland gaps exist which leave farmers a potential financially vulnerable group in old age. • Provisions requiring State financial support are required to include farmers in the Irish social welfare pension system. • Solutions to reform pension policy in Ireland to protect the financial welfare of farmers in retirement are proposed.