Free Movement? The Impact of Legislation, Benefit Generosity and Wages on the Pensions of European Migrants

Authors


Correspondence to: Traute Meyer, Social Sciences, Faculty of Social and Human Sciences, University of Southampton, Highfield, Southampton SO17 1BJ, UK.

E-mail: t.meyer@soton.ac.uk

ABSTRACT

European (EU) economic integration has always involved a commitment to the free movement of labour, services and capital. However, the development by EU institutions of specific rights with respect to labour mobility has been slow. This paper explores this issue from the perspective of pension rights, among the most long-lasting for citizens. It shows that the literature on this topic has focussed mainly on EU regulations, their scope and limitations. The paper argues that, although important, this work has led to the neglect of a more fundamental issue: the potential impact on mobility of the relative generosity of pension schemes and large national wealth variations, an increasingly salient issue since the expansion of the EU into Eastern and Central Europe. Thus, on the basis of a detailed review of dominant intra-EU migratory patterns, the paper investigates the impact on pension rights of movement between Beveridgean and Bismarckian pension systems and between countries of substantially different wealth. It shows that lower income workers who move from Beveridgean to Bismarckian countries would be most at risk of pension losses. However, such movement is unusual; instead, the majority of intra-EU migrants move from Bismarckian systems of low generosity in the poorer east to Beveridgean and more generous Bismarckian in the richer west. Workers who make this move are more likely to experience pension gains than losses. For them, free movement is achieved. Copyright © 2013 John Wiley & Sons, Ltd.

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