There are four main ways in which OECD countries might provide retirement incomes to meet a minimum standard of living in old age (

Table 1.2). The left-hand columns of the table for each economy show the value of benefits provided under these different types of schemes. Values are presented in relative terms – as a percentage of economy-wide gross average wages – to facilitate comparisons between economies (see the “Average wage” indicator in Chapter 3). The right-hand columns show the number of total recipients as a share of the population aged 65 and over.

Benefit values are shown for a single person. In some cases – in particular for minimum contributory pensions – each partner in a couple can receive an individual entitlement. In other cases – especially for targeted schemes – the household is treated as the unit of assessment and generally receives less than twice the entitlement of a single person.

The analysis of benefit values can be complicated by the existence of multiple programmes in some economies. In some cases, benefits under these schemes are additive while in others, there is a degree of substitution between them.

There are five economies that do not have either a basic or minimum pension within their system (China, Hong Kong (China), Malaysia, Singapore and Sri Lanka). Only Thailand has a basic pension. India, Indonesia, Pakistan, the Philippines and Viet Nam all have minimum pensions.

Figure 1.2 summarises the level of non-contributory residence‑based benefits. A residence‑based basic pension is only present in Thailand. On average amongst all Asian economies, 9% of gross average earnings can be received from basic or targeted schemes subject to means tests.

As for the contributory components of first-tier pensions, six Asian economies have neither contribution-based basic nor minimum contributory pensions (Figure 1.3). Only the Philippines has a contribution-based basic pension. In five Asian economies, low contributory pensions are topped up to a higher minimum pension level, up to 19% of average earnings, on average, among countries with minimum contributory pensions. These minimum pensions vary between a low of about 5% of the average wage in India to a high of about 42% in Pakistan.

The importance of first-tier benefits varies across Asian economies. The percentage of over‑65s receiving such benefits is shown in the final four columns of

Table 1.2. Different approaches of reporting the number of recipients, for example in case of benefits paid to couples or even households, may blur the data comparability across economies to some extent.

Naturally, residence‑based basic pensions have on average the highest coverage. However, contribution-based basic pensions also have very high recipient numbers in most economies that have such a scheme. Sometimes recipient numbers exceed 100% of the population aged 65 and older hinting to recipients younger than 65 or living abroad.

Targeted schemes in Asian economies show the greatest variation, being claimed by only 2% of those aged 65 or over in Indonesia and 7% in Malaysia but by 56% of those in the Philippines and 42% in Hong Kong (China). These higher rates are primarily due to historically low coverage rates in mandatory pension schemes.