The ILO promotes a rights-based approach to the protection of older persons. This approach is based on international human rights and social security standards. It provides technical support to the development and reform of old-age pension systems in the face of the demographic transition, economic cycles and the growth of the informal economy. Read more on the work of the ILO in the field of old-age pensions

Pensions for older women and men are the most widespread form of social protection in the world, and a key element in meeting SDG target 1.3. Globally, 77.5 per cent of people above retirement age receive some form of old-age pension. However, major disparities still exist across regions, between rural and urban areas, and between women and men.

Pension systems are often composed of a mix of contributory and non-contributory schemes aimed at providing income security. As both the expression and the result of social solidarity, and when financed sustainably with due regard to social justice and equity, pension systems are a key means by which States can ensure redistribution and overcome various inequities in societies.

In countries with high levels of informality that face difficulties in extending contributory schemes, the introduction of tax-financed pensions has allowed the extension of coverage to previously uncovered population groups, especially women. However, in many instances the benefits provided lack a legal basis and do not provide adequate levels of basic income security that can guarantee a dignified life.

Significant progress has been made with respect to the objective of extending pension systems in developing countries to achieve universal coverage. Universal pensions have been developed in a wide variety of countries, including in low- and middle-income countries, as part of national social protection floors.

Observed trends vary substantially across regions and even among countries within the same region. In countries with comprehensive and mature systems of social protection, with ageing populations, the main challenge is to maintain a sound balance between financial sustainability and pension adequacy. At the other extreme, many countries around the world are still struggling to extend and finance their pension systems; these countries face structural barriers linked to low levels of economic development, high levels of informality, low contributory capacity, poverty and insufficient fiscal space, among others.

Apart from the challenge of extending protection to uncovered people, ensuring that those who benefit from pensions are able to maintain themselves in health and decency represents another important challenge.

Adequate protection in old age remains a challenge for women, people in low-paid jobs, those in precarious forms of employment, people working on digital platforms and migrants.

Public pension schemes, based on solidarity and collective financing in line with ILO social security standards, remain by far the most widespread pillar of old-age protection globally. Many countries are introducing parametric reforms to their contributory pension systems in order to adapt them to changing conditions and ensure their long-term sustainability. While important, these parametric reforms can only go so far in the face of macro phenomena such as wage suppression, frozen contribution rates, growing inequalities and, last but not least, the falling labour share of income.

Increasingly, public pension schemes are complemented by voluntary or mandatory defined contribution schemes (individual savings accounts and notional defined contributions), the objective of which is to raise benefit levels on the basis of market or economic performance, although without guarantee as to the levels ultimately secured.

The COVID‑19 crisis brought additional pressures to bear on the costs and financing of pension systems, but with a moderate to low impact over the long term. The massive response of countries to the crisis has highlighted the critical role that old-age protection systems, including long-term care, play in ensuring the protection of older adults, particularly in times of crisis.