GLOBAL - The Netherlands still boasts the best retirement income system in the world, according to a Mercer survey comparing more than a dozen counties.

The Melbourne Mercer Global Pension index - which examined 14 countries, including Germany, the UK, Japan, China and, for the first time, Switzerland - ranked the countries' retirement systems on adequacy, sustainability and integrity.

The Netherlands, last year's winner, achieved an overall score of 78.3% and by far the highest integrity score of 91.4%.

France came 11th, receiving the worst European grade for the sustainability of its system, achieving only 29.7%.

However, the country fared better when examining how adequate the payouts of the system were, coming second behind only the Netherlands and more than 10 percentage points ahead of Germany with 74.9%.

The Netherlands achieved the highest ratings for both integrity and adequacy, but was beaten by Sweden on sustainability, where the Scandinavian country achieved almost 73%, compared with an overall score of 74.5%.

The UK ranked sixth, pushed down one by new entrant Switzerland in second, but was praised for its system's integrity despite being only seen as marginally more sustainable than Germany.

Deborah Cooper, a partner at Mercer in the UK, said: "The UK's position could be improved by raising the minimum pension for low-income pensioners, by increasing the coverage of employees in occupational pension schemes and by raising the level of household savings.

"The index favours pension arrangements that are funded and broadly inclusive, so the introduction of auto-enrolment should contribute to an improved score from 2012."

A lack of funding would also explain Germany's low rank, as contractual trust agreements are often in place for larger companies, and the so-called Riester Rente has yet to gain a foothold.

David Knox, a senior partner at the consultancy's retirement, risk and finance business, said: "The crisis has threatened the sustainability of public and private pension systems in several countries through the decline in asset values and an increase in government debt."

Knox singled out the UK, as well as Canada and the US, which were ranked fifth and 10th, respectively, as having been particularly affected by this.

"As the gap between pension age and life expectancy widens, pressure on public pension systems will increase," he said.

"This highlights the need for governments to continue to review their state pension or retirement age and focus on increasing the adequacy of the private system."

While none of the countries achieved the top grade, three out of five European countries received a B, with the UK, France and Germany graded C alongside Chile, Brazil, Singapore and the US.

Japan and China rounded out the survey with overall scores of 42.9% and 40.3%, respectively.