We are always hearing about the threat posed to pensions by the ageing of the population, and particularly pensions in the first pillar (public pension schemes) financed by the working age population (pay-as-you-go systems). Over the next half century, it is predicted that the proportion of people over 60 years of age in industrialized countries will double, rising from 20 to 40 per cent of the total population. As these people will essentially depend on old-age insurance schemes for their wellbeing, how can the viability of such schemes be ensured insofar as they are principally financed through the wages earned by a diminishing labour force? According to current projections, the ratio between the retired population and the working age population will fall from between four and five working age persons for every retiree today, to two working age persons for each retiree in 2050 (United Nations, 2000).