Pension reform is a key political issue in most western European countries but takes a different shape depending on the institutional structure of existing pension systems. There are two different models of pension provision: social insurance and multipillar pension systems. Their vulnerability to socioeconomic developments differs dramatically. Multipillar systems better withstand the demographic challenge and adapt better to internationalized financial markets, but they are less effective than social insurance systems in integrating atypical employment. The distinction between two models of pension provision also helps explain reform trajectories and suggests that the impact of decisions made decades ago will continue to influence pension policy for some time to come.