See All Customer Reviews. Shop Books. Add to Wishlist. USD Sign in to Purchase Instantly. Overview As the role of private pension systems grows in importance, there is a need to monitor their development and review their performance in an international context, especially following the crisis in the financial markets in From the perspective of TUAC, the BFO offers key takeaways for monetary policy makers who should seriously reflect on how current quantitative easing is delivering unconditional support to financial markets and the rise of low quality securities.
There are also policy lessons to be drawn on corporate governance.
Guest author – Page 56 – OECD Insights Blog
A key area of concern is whether the rise of corporate bonds is transmitting into the economy into real investments. Previous OECD reports suggest that there is no such take up. By contrast, business expenditures in share buy-backs and in dividends have been booming.
Doing so, the report fails to acknowledge the role of mandatory rules and of whistle-blower protections in both legal and corporate policies. Voluntary corporate initiatives cannot be considered as an adequate substitute for law-making. Whilst the BFO underlines the role of governments in introducing compliance incentives, it does not stress the primary role of democratic governments in safeguarding public interest by designing strong legal standards and enforcing them.
As far as corporate law is concerned, limited liability should be considered as a privilege and much more attention needs to be paid to the requirements governing the registration and licensing of companies e. Furthermore, employees and their representatives are missing from the BFO.
A key element in the BFO is the call for further data. The chapter on investment for example, cites the need for data to enable investors and companies to meet responsible business conduct objectives. The availability issue of data should not prevent broad policy action however.
Instructive data is widely known and available. When it comes to trust in financial institutions such as the pension funds , the BFO does list a number of more substantial issues including an ageing population, low returns on retirement savings, less stable employment careers and insufficient pension coverage among some groups of workers. Finally, left leaning political parties, like the NDP, and social organizations that had been very active up to the s and that helped implement progressive social policies, have also been weakened since the mids, party politics in Canada shifting strongly to the right Johnston, This is the consequence of a very large country, with two great and very distinct communities, and an enormous border with a superpower.
In Canada, the provinces and the dynamics between provinces and the federal State have been fundamental for the construction of the social protection system. Provincial social innovation became national when the federal government reacted to a possible factor of disunion. And again, when the Quebec government rejected the idea of cutting the pension system. A question may play a role in the future due to the fact that while the rest of Canada is becoming more unequal, the province of Quebec has implemented a number of programs that have allowed it to escape the general trend and, in fact, expanded social protection.
The transformation of the welfare systems in North America3 As we mentioned in the introduction, we have not been able to witness a clear tendency to convergence in all three countries and in all three subsystems we analyze in this article pensions, health and assistance. We have nevertheless found similar tendencies in all three countries in the subsystems that are more exposed to globalization, both in economic terms and with respect to the assumption by national political elites of the liberalization program for ideological or political reasons; this is the case of both the labor market and pensions.
In contrast, health and assistance, subsystems less directly connected to capital, and more complex because they both depend more on internal social and political needs and dynamics, have suffered a less unilateral liberalization.
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In Mexico, on the contrary, a coalition between the State and financial interests radically transformed a pension system that was limited to the workers with a formal job from a pay-as-you-go system to a total capitalization system. Thus, in both the United States and Canada, pensions are mixed: both public and private; the private being much more important than in other developed countries: In the United States almost half of the amount of the pensions for any individual comes from the public funds and half from the private ones. Nonetheless, the conditions in the last twenty years in both countries have worsened for pensioners.
Although it is true that since it has increased from 3. The problem in Canada resembles that of Europe, where baby boomers are reaching the age of retirement in a context of low population growth. In this case, although immigration is high, it does not compensate for a very fast decreasing birth rate.
In contrast to Canada, although Social Security in the United States has not been modified, many of the compulsory contributions that were implemented by company funds have been substituted by private accounts, which are voluntary. The decline of unionism led many companies to reduce their pension programs. Since this situation has worsened due to many company bankruptcies. Finally, there has been an extended fiscal policy of advantaging individual savings by fiscal deductions.
Such a weak system, because it is seen as a privilege for only part of the workers, was totally privatized in the s and s, going from a pay-as-you-go system to a total capitalization one. NO-its , its in the bibliographie]. On the other hand, unions accepted the reform because the change would affect the new entrants and not those that were in the system. The system was transformed by an alliance between the government and the financial interests. In both countries, the poor have been the most affected by cuts, basically because they are the least organized and weakest social sector.
In Canada, since , the liberal governments have reduced the unemployment benefits and the transfers to the provinces, both of which have mainly affected the poor, although they maintained their social inclusion rhetoric. On the contrary, the conservative governments have been restricted in their intent of cutting social spending and retrenching of the welfare regime Bizberg and Martin, , The cuts in this country were basically related with the fiscal crisis of the federal State of the mids that had as its consequence the reduction of transfers from Ottawa.
The provinces reacted differently to this situation, some compensated and maintained the level of spending Quebec , while the richest and more liberal ones followed federal policy. In , the Canadian Assistance Plan was unified with health and education in the Canada Health and Social Transfer, a measure which was designed to progressively cut the expenditure of the federal social programs Banting and Myles, ; Maioni, The renovation in Quebec came especially in what concerns family policy: universal childcare, active labor market policies and a strategy against poverty and social exclusion Banting and Myles, 16— Another example of a trend that is also very different from the purely institutionalist interpretation is that of Mexico.
Mexico followed a contrary trend, shifting from corporatism to assistance. While, before the crisis of the s, the organized workers and peasants were the main political support of the PRI, the effects of the crisis, the abandoning of import substitution for an export-led economy had as one of its major effects the increase of the informal sector and of the poor.
These sectors became the main political basis of the subsequent governments. By instrumentalizing globalization, the ideological resources of neoliberalism, and the support of institutions such as the World Bank, the Mexican State managed to transform the character of the welfare state from one oriented to co-opt organized labor towards another directed to assist and gather political support from the poor.
In both Mexico and the United States, the health system has advanced toward universalization, although in both countries it is still far from having reached its goals. In Canada it has maintained its universal character, although the ageing of the population plus the underinvestment of the subsystem during the last twenty years has reduced its quality. The system hinges on private insurance plans, some allocated by work places if they are big enough , but most increasingly so individually financed. It is a very inefficient system, for the United States spends In addition, many people, even those that are covered by health plans, go broke or have to spend a great amount of money when they get sick due to co-payments or because they exceed their coverage.
There are, in addition, smaller contributory health schemes for the army and petroleum workers. Until recently, the rest of the population had, only formally and in effect for only very serious situations, access to the open public State health services. Although the Mexican government has repeatedly announced the right of all the population to health services in its hospitals and clinics, the fact that they had no right to these services but were allocated according to need forced them to recur to private practice.
On the other hand, medicines prescribed were almost always lacking, both in the public system and the social security one. In addition, as the waiting time in all these services was so long, many patients preferred to pay for a private doctor for non-serious diseases. Although both Mexico and the United States have recently followed a path towards universalization, while in the United States it continued its dominant market character, based on private insurance companies the idea of a public insurance company was eliminated from the Obama health care plan very soon in the game , in Mexico the health care plan is a complement to the assistance program, Progresa,7 and is a public, basically free, Medicaid type insurance, although it restricts itself by posing a limited catalogue of diseases.
The Obama health plan is fundamentally based on economic stimuli for individuals that cannot afford the insurance plans that exist in the market, the obligation on the part of the insurance companies to propose affordable plans to them and fines against individuals who do not contract some plan. It is also explained in political terms by the election of the first black president on a more social agenda, based upon black and migrant population more hardly touched by both the crisis and the lack of health coverage.
In the case of Canada, universal health care and the State as sole payer have become cultural characteristics that distinguish Canadians from Americans. In this country, then, no party would dare touch the system. As health insurance like education is an exclusive attribution of the provincial governments, it has been fiercely defended by most of them: each time the federal government threatens to reduce its transfers or intervene too much, the provincial governments resist. On the other hand, the federal government is always attentive to growing differences between the provinces and stops any hints of privatization of the system, such as those observed in Alberta and British Columbia, that could menace its survival as a federation.
Thus, the issue is neither universality, nor availability as everybody has a right to health services, nobody goes broke as a result of falling sick , but the fact that the system is overcrowded and waiting times for certain medical acts have strongly increased. In part because of the aging of the population, but also because the resources allocated to the system have been reduced since the mids.
The question is then how to make the system more expedient. One possibility is to invest more in a system that has proven to be very efficient in the past, another is to introduce private health into the system, under the idea that it is more efficient, more capable of innovation, etc. Finally, in the case of Mexico, the goal was neither the preservation of a health service market nor a universal public health system, but the construction of a health system which would be complementary to the conditional and eventually the unconditional cash transfers. The idea of a universal coverage, albeit at a minimum level, is a complement of the shift from a social security system based on corporatism to one based on assistance.
This program intended to attain universal health care and although it did not propose to integrate the contributive and non-contributive health sector, its implications will most certainly lead to this in the future. It started out by incorporating all the recipients of Oportunidades that entered the program with no charge and gave the possibility, on a voluntary scheme, to informal workers to enter by paying a small fee.lnkscorp.com/oneplus-5-spy-application.php
OECD Private Pensions Outlook 2008
Although the measure to integrate the poor was surely quite positive, because it formally gave them the right to demand health care, the informal workers have not massively subscribed. In fact, data of international institutions such as WHO have mentioned that there are still more than 30 million people without coverage. Final considerations In this article we have been able to see that the dynamics of globalization have the same effects neither in the three countries of the North American area, nor in the three dimensions we have considered—pensions, health and assistance. In the realm of pensions, we have seen how, despite the fact that both Canada and the United States started out from a similar system, with a low substitution rate, its high level of coverage makes it very popular and thus difficult to modify for electoral reasons.