Pension systems compared : a polarised perspective, a diverse reality

Production of INCASI Project H2020-MSCA-RISE-2015 GA 691004Globalisation and international competition have a spillover effect on the reforms of pension systems that imposes a similar pattern of dismantling, hardening access to pensions, reducing expenditure and retrenchment in said reforms. The comparative analysis of four countries with different pension systems: two liberal (United Kingdom and Chile) and another two with contributory-proportional systems (Spain and Argentina) serves to determine the details of the reform processes, which discursively seem to have a shared pattern recommended by the international financial and economic institutions. But the reality of the four case studies shows considerable differences in the implementation of the pension reform policies. The reforms depend on the societal context, institutions, history, the role of unions, the government in power, demographic factors and economic perspectives, among other matters. Many countries need to sustain pension systems because they are associated with many pensioners' political vote. Therefore, the spillover effect of globalisation and the convergence in certain uniform patterns of reforms is far from reality in the four countries, and as such, the measures adopted are specific for each country

Creating French-style pension funds: Business, labour and the battle over patient capital

European governments are increasingly retreating from public pension provision and promoting the expansion of private pension funds. Analysts of comparative social policy have traditionally considered that the politics of pension privatisation is driven by politicians’ and socioeconomic actors’ concerns about the generosity and costs of pension arrangements. But, when they are fully funded instead of being financed on a pay-as-you-go basis, pensions generate funds that are injected into the financial system. The existence of such a welfare–finance nexus means that stakeholders in the pension system are also attentive to how pension funds invest their assets, and may try to actively shape the institutional design of pensions in accordance with such financial concerns. This article focuses on the role of organised labour and business, that is, employers and the financial industry, in pension privatisation and develops theoretical expectations on how these actors’ interest in maximising control over private pension funds’ financial assets affects pension politics. The argument is tested with a case study of French pension privatisation between the 1980s and the 2000s

Taking back control: comprador bankers and managerial developmentalism in Poland

With rare exception, political economists assume that developmental policies and developmental alliances between states and business result from top-down, state co-option or coercion of business. They also do not expect the subsidiaries of multinational corporations (MNCs) and their local, non-expat, managers – the ‘compradors’ – to press for developmentalism in host countries. Based on process tracing of Polish economic policy since the 2008 global financial crisis (GFC), I argue that, in Poland’s dependent market economy and FDI-led growth regime, ‘comprador’ bankers co-opted state actors into renationalizing foreign-owned Polish banks and into reforming development institutions to support indigenous firms’ expansion. Moreover, comprador bankers operationalized new industrial policies for which state actors, indigenous entrepreneurs and ‘compradors’ simultaneously started pressing in the 2010s. Comprador bankers’ motives were their frustration at their weak managerial autonomy in foreign-headquartered MNCs and their concerns about the negative macro-economic implications of their parent banks’ attempts to capture their Polish subsidiaries’ excess liquidity during the GFC in order to improve their own liquidity positions

The financial crisis and varieties of pension privatization reversals in eastern Europe

Since the global financial crisis, those East European countries that had partly privatized their pension systems in the 1990s or early 2000s increasingly scaled back their mandatory private retirement accounts and restored the role of public provision. What explains this wave of reversals in pension privatization and variation in its outcomes? Proponents of pension privatization had argued that it would boost domestic capital markets and economic growth. By revealing how pension privatization helped increase sovereign debt and how large a part of pension funds' assets was invested in government bonds, the crisis strengthened the position of domestic opponents of mandatory private accounts. But these actors' capacity and determination to reverse pension privatization depended on the level of their country's public debt and on pension funds' portfolio structure. Empirically, the argument is supported with case studies of Hungarian, Polish, and Slovak pension reform

Shareholders of the world united? Organized labour’s preferences on corporate governance under pension fund capitalism in the United States, United Kingdom and France

This article considers whether organized labour’s engagement with shareholder activism represents a shift in unions’ traditional stakeholder preferences on corporate governance under pension fund capitalism. It does so in light of recent critiques of the class power thesis of corporate governance which suggest greater fluidity and fragmentation in labour’s approach. Adopting a diverse case study strategy to compare organized labour’s actions in the United States, United Kingdom and France, the paper explains these activities as innovative strategies, similar to other revitalization initiatives, designed to advance traditional agendas by alternative means. The paper thus concludes that, while organized labour’s shareholder activism is unexpected under the class power thesis, its core preferences remain largely unchange

The Sputnik V moment: biotech, biowarfare and COVID-19 vaccine development in Russia and in former Soviet satellite states

Why has Russia been able to develop and produce Sputnik V while Central and Eastern European (CEE) countries that are members of the European Union have only played a marginal role in global supply chains for the production of vaccines against COVID-19? We argue that this capacity results from efforts by Russia’s national security state and entrepreneurs to turn a Soviet advantage in the development of biological weapons into a contemporary public health advantage in vaccine and drug development. CEE countries have lacked Russia’s historical legacy of and contemporary drive for security motivated statecraft. Nor have they massively invested – as for example Cuba has – into their public health systems and in potential synergies between such systems and biotech firms

Solidarity against all odds: Trade unions and the privatization of pensions in the age of dualization

In an era of fiscal austerity and dualization of social protection, has organized labor become increasingly split along skill and industry lines? Against recent political science accounts of trade union involvement in social policymaking, this paper argues that, in the specific area of pensions, unions representing high-skilled workers and the core industrial sectors of the economy have paradoxically been led to increase their cooperation with unions representing the less privileged segments of labor, in order to improve coverage of private pensions across the board. These unions’ motivations for doing so and the strategies they have employed have nonetheless differed according to the preexisting institutional design of domestic pension systems. The argument is supported with case studies of British, French, German, and Belgian unions’ involvement in contemporary pension reform

Insuring individuals… and politicians: Financial services providers, stock market risk and the politics of private pension guarantees in Germany

Studies of the rise of private defined-contribution pensions traditionally focus on social policy concerns about the allocation of risks and costs for beneficiaries and employers. There is, however, another – low-salience, financial – dimension of pension privatisation. Regulations introducing minimum return guarantees in private pensions impact financial markets because they incentivise fund managers to invest plan portfolios in fixed-income securities rather than in equities. While different segments of the financial industry have divergent preferences over such guarantees, policy-makers are caught in a dilemma: Should they prioritise predictable benefit levels or equity market development? Using the case of the introduction of Germany’s ‘Riester-Rente’, we argue that, as politicians linked the introduction of private defined-contribution plans with cuts in statutory pensions, the re-emergence of a high-salience, social policy image of pensions helped insurance firms’ and some trade unionists’ case for minimum guarantees to prevail, thereby hindering equity market development in Germany

A perfect storm: COVID-19 and the reorganisation of the German meat industry

An advocacy coalition of trade unions, churches and NGOs had been trying for a long time to mobilise domestic media and politicians in order to re-regulate the German meat industry. The meat industry’s low-cost business model, using employee posting and subcontracting on a massive scale, has led to extreme forms of unsafe working and poor living conditions for large numbers of Central and Eastern European workers. But it is only in the wake of the COVID-19 pandemic that the German government decided to ban subcontracting, posting and temporary work in this industry. Why did COVID-19 make a difference? In an industry in which the livelihoods of local communities in Germany’s pig belt and in deprived rural parts of Romania have become structurally dependent on subcontracting, institutional change would not have happened without the pre-existing mobilisation of the above-mentioned advocacy coalition. But COVID-19 created a ‘perfect storm’ that empowered this coalition by helping reframe the meat industry issue away from a ‘narrow’ employment regulation problem into a ‘broader’ public health threat. Indeed, after becoming a virus hotspot, the meat industry was no longer just a threat to the livelihoods of its own workers, but to those of the wider local community