The key facts

  • Netherlands — 85.8 points, Denmark — 84.1, Iceland — 84.0; 55 systems assessed in total, covering 66% of the world's population
  • Spain: 83 points for adequacy but 33 for sustainability; France — 85 and 49.3 respectively
  • Turkey — last among the 19 assessed European countries; Austria, Italy and Spain are named the most vulnerable in the long term

The Netherlands — leader of the ranking for the fourth year in a row

The Netherlands took first place in the 2026 Mercer CFA Institute Global Pension Index (MCGPI), scoring 85.8 points out of 100. They are followed by Denmark (84.1) and Iceland (84.0) — the only European systems to receive the top grade. The category of the world's best systems is completed by Singapore, Israel and Australia. The index compared 55 national retirement income systems, covering 66% of the world's population, across three sub-indices: adequacy of retirement income, sustainability, and governance quality and protective mechanisms. Other countries lead on individual indicators: Kuwait — on adequacy, Denmark — on sustainability, Finland — on integrity.

Why the Dutch model is considered the best

The report's authors call the Dutch system a 'sustainable retirement income system': the state pension provides a reliable minimum income, occupational plans cover the majority of workers, and a large volume of invested pension assets helps guarantee future payments. The system is distinguished by strong regulation, governance and participant protection. At the same time, the Netherlands is carrying out a reform: the country is moving from guaranteed benefits tied to salary and length of service to individual pension 'capital' depending on contributions and investment returns. The reform is linked to low interest rates, which have made it difficult to finance promised benefits, and to less flexible occupational pensions for frequent job changers and the self-employed. The transition is planned to be completed by 2028.

The balance of power in Europe

The index covered 19 European countries, including Turkey. After the three leaders come Sweden, Finland and Norway, then Switzerland, the United Kingdom, France, Ireland, Belgium, Germany, Portugal and Croatia (grades B+ or B). In the C+ and C categories are Spain, Poland, Italy and Austria — alongside the USA and mainland China. The most pronounced long-term vulnerabilities among European countries were noted for Austria, Italy and Spain. The contrast is especially stark in Spain: 83 points for adequacy but only 33 for sustainability. France scored 85 for adequacy and 49.3 for sustainability. Turkey closes the European ranking with the lowest score for resources and funding.

Warnings from central bankers and the European Commission

Graham Pearce, head of global defined benefit solutions at Marsh, noted in an interview with Euronews Business that for pay-as-you-go systems the key problem is the significant increase in the number of pensioners relative to workers in the coming decades. Bundesbank President Joachim Nagel said in May 2026 to Handelsblatt that linking Germany's retirement age to life expectancy after 2031 could help, and called the new private pension scheme to be launched in early 2027 'an important step towards strengthening the funded pension pillar', but warned that this is not enough to solve the long-term problems. Then-head of the Bank of France François Villeroy de Galhau warned in an interview with Le Figaro: 'We are shifting the burden of debt and pensions onto our children.' In September 2026, the European Commission called for developing additional savings alongside state pensions, warning of the risk of a 'sharp drop in income' after retirement for too many people.

The report's recommendations and risk assessment

The report proposes expanding coverage of private pension programmes, improving the governance and transparency of private plans, raising the retirement age in line with increases in healthy life expectancy, supporting the employment of older people, encouraging private savings and reducing the gender pension gap. According to Pearce, governments unwilling to raise the retirement age or cut benefits will have to find additional revenues — through taxes, social contributions or encouraging longer working lives. He expects wider adoption of automatic enrolment schemes in pension plans and believes that young workers do not necessarily have to expect less generous state pensions in the next 10–20 years, but that parallel savings are necessary for sustainability. Commenting on France and Spain, Pearce warned: without measures to improve sustainability, governments may face difficult decisions, including benefit cuts, when existing schemes become financially unaffordable.