Approaches to Increasing Retirement Income in the Public Pension Insurance System in Austria

Against the background of persistently high gender pension gaps, this study analyses the effects of different simulations on the gender pension gap and pension expenditure. The first simulation is a higher valuation of partial insurance periods for child-rearing and unemployment, the second is the introduction of a gender pay gap factor, and the third is a switch from a life-time calculation to the 15 best years of earnings on the individual pension levels of the 2015 to 2021 cohorts. The impact on the income and poverty risk of affected households is also considered. The revaluation of the partial insurance period for bringing up children would increase women's pensions by around 9 percent on average, while the revaluation of unemployment would increase them by between 2 and 5 percent, depending on the person concerned. Taking into account the gender pay gap would reduce the gender pension gap to up to 27 percent, depending on the specific implementation. Higher individual pensions would also reduce the at-risk-of-poverty rate of affected households by up to 7 percent, while a higher equalisation supplement reference rate would reduce the at-risk-of-poverty rate of pensioners living alone to as low as 2 percent.