The New Pension Orthodoxy in Central, Eastern and South Eastern Europe: Lessons for Prospective Reformers

Central, Eastern and South Eastern Europe very eagerly embraced the new old age pensions paradigm sponsored by the World Bank and prescribing the partial pre-funding of public schemes. The new pensions orthodoxy has ascended to global policy status, but its future implications were little known at the outset. Most post-socialist European countries have already chosen their reform paths, however, it is important for those still struggling to learn from the experiences of their peers in order to avoid analogous mistakes. To this end, this article provides a concise account of the pensions crises and responses in Croatia, Hungary and Slovenia. Notwithstanding the differences in institutional design and social impact, the three countries have in common the future unsustainability of their multi-pillar retirement systems. This should fundamentally warn future reformers against precipitous policy solutions.