May 2020
18May

UK. Pension savers unable to move their cash as trustees use emergency powers

Savers who want to ditch defined benefit pensions as their employers struggle to survive may find themselves trapped by trustees using emergency powers to halt transfers. Businesses facing financial hardship have been the first to see trustees of their staff pension funds block members from moving their cash for three months during the pandemic. This stops anyone wanting to transfer out of defined benefit pensions, which pay a guaranteed income in retirement, into more flexible but riskier “defined...

May 18, 2020
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18May

EC summons Netherlands for taxing pensions moving abroad

The European Commission has summoned the Netherlands to the European Court of Justice (ECJ) for taxing pensions moving abroad. It argued that the taxation conflicts with the principle of free movement of capital. According to the EC, workers must be able to transfer pension capital to another member state, even if the country of destination allows taking out a lump sum of up to the entire pension entitlement. Twelve member states, including Germany, Belgium and Denmark, have already introduced...

May 18, 2020
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18May

Social protection responses to the COVID-19 crisis around the world

By ILO This note summarizes the results of the Social Protection Monitor that tracks announcements of social protection measures responding to the possible impacts of the COVID-19 crisis. We will update this note as new data and information become available in this rapidly evolving situation. Disclaimer: Owing to the exceptional circumstances generated by this global health pandemic, there has been intense activity in terms of the breadth of national responses and therefore not all information contained in this document could be...

May 18, 2020
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15May

Informality and the Challenge of Pension Adequacy: Outlook and Reform Options for Peru

By Christoph Freudenberg and Frederik Toscani Past reforms have put the Peruvian pension system on a largely fiscally sustainable path, but the system faces important challenges in providing adequate pension levels for a large share of the population. Using administrative microdata at the affiliate level, we project replacement rates in the defined benefit (DB) and defined contribution (DC) pillars over the next 30 years and simulate the impact of various reform scenarios on the average level and distribution of...

May 15, 2020
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15May

The End of Leisure and Retirement, COVID-19: Innovations, Jobs, Pensions, and Keynes: Guaranteed Income or Future Poverty and Redundancy?

By Niccolo Leo Caldararo The history of the support by society of the aged is discussed in cross cultural and historical context. Various cultural traditions are compared with the forms developed in complex societies from ancient Egypt and Greece and Rome, to China, the Aztec, Inca and Maya, to those of religious organizations, or those developed under different modern ideological systems like capitalism and communism as well as social democratic nations. It is found that the way a...

May 15, 2020
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15May

Firm Behaviour in Pension Funding – An Analysis of Corporate Debt Issuing

By Marion Boddy This study investigates the commonality of United States firms using the issuance of corporate debt as a tool to fund their pension plans. The results suggest a prominence of firms in the sample utilizing debt issuances to transition their fund from underfunded to overfunded. These results are indicated through a statistically significant negative relationship between the cost of debt and an underfunded indicator when regressors are lagged by one year. Results also indicate that equity issuances...

May 15, 2020
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15May

Selfies can help Brazil create a super supplementary pension

By Arun Muralidhar, Robert C. Merton, Alexandre Vitorino Brazilian policy makers and researchers have discussed the introduction of a complementary pension system to complement the Regime Geral de Previdência Social (RGPS), specially for those that want a retirement income above the RGPS ceiling. This article first recommends that the complementary system must be SUPER (Simple, Universal, Portable, Efficient with low cost and Robust Regulatation). It then proposes the adoption of a financial innovation called SeLFIES (Standard-of-Living, Forward-starting, Income-only Securities),...

May 15, 2020
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15May

India. World Bank to provide $1 billion loan for social protection

After healthcare, the World Bank on Friday said it had cleared a $1 billion assistance for social protection and is in talks with the government for funding initiatives to assist micro, small and medium enterprises (MSMEs). World Bank country director Junaid Ahmad did not elaborate on the size of the loans for MSMEs, saying they were being negotiated. Read also Covid-19 impact: Global pension funds pause India investment He, however, complimented the government’s approach, focusing on healthcare, social protection and...

May 15, 2020
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15May

Swiss pension funding levels recover after falling below 100%

The funding ratio of Swiss Pensionskassen bounced back to 103% in April after declining to 99.8% for a short time at the end of March, according to Complementa’s latest “risk check-up” analysis report. Central banks have sent a clear message through a series of interventions to say they “stand by” the equity market “whatever it costs”, Thomas Breitenmoser, head of investment consulting at Complementa, told IPE during a conference call. The funding ratio of Swiss pension schemes will depend...

May 15, 2020
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15May

How the UK pensions industry is paving the way for open data sharing ecosystems

As consumer expectations around digital services increase, businesses across every sector are looking to meet a growing demand for better, and more user-friendly, applications of data. The Covid-19 pandemic has only accelerated this shift to digital as traditionally offline activities move online, and businesses are racing to stay ahead of both their customers and their competitors. The UK pensions industry might not seem an obvious place to look for inspiration about how to adapt to digital transformation, but that...

May 15, 2020
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