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The Actuary The magazine of the Institute & Faculty of Actuaries


With reference to Professor Mayhew’s article in the May issue, rather than point the UK at a policy to encourage young immigrants, which could become competitive across the mature countries of Europe, I suggest that our profession should be pursuing a different line of thought. We should solve the issues of operating an EU-wide basic state pension, with a system in which individual contributions related to average earnings in the country of employment would earn a correspondingly denominated increment of pension. With the widening of the EU to eventual inclusion of Turkey, the balance of pensioners to contributors would ease considerably.

The underlying arithmetic might also point towards ways of harmonising existing national schemes and thus provide a rational input to an important EU budgetary issue. Any UK solution to our national cashflow problem may otherwise be overwhelmed by an EU tax aimed at financing the large deficiencies of ‘older’ Europe.