April 2020

27Apr

Suspended UK pension contributions could total £1bn

Up to £1bn in pension contributions could be suspended this year as businesses strike deals with retirement scheme trustees to keep afloat during the Covid-19 crisis. The estimate emerged from a Financial Times survey of professional services companies advising more than half of the 5,500 employers backing “defined benefit” pension schemes in the UK. A lockdown of the nation’s non-essential businesses and households has left many companies facing steep reductions in revenues and a subsequent cash crisis, resulting in interventions by...

April 27, 2020
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27Apr

US. Coronavirus’ Impact on Retirement Money in the Market

The COVID-19 crisis has taken a major toll on the U.S. economy, and has been battering the stock market since the virus started spreading rapidly in March. It's not shocking, then, to learn that 401(k) and IRA balances have taken a hit. The average 401(k) balance fell to $91,400 during the first quarter of 2020, according to Fidelity. That's a 19% or $20,900 drop from the fourth quarter of 2019. IRAs didn't fare all that much better. The average IRA balance fell to $98,900 in...

April 27, 2020
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27Apr

COVID-19 – an ageing world makes it harder to fight pandemics

By Andrew Scott The global fight against COVID-19 has triggered a surge of interest in the 1918 to 1920 influenza pandemic that killed more than 50 million people around the world. But while we can learn lessons from the past, we must recognise what is different this time and tailor our response accordingly. Read also US. How The Pandemic Is Making The Retirement Crisis Worse — And What To Do About It Above all, society is ageing. In 2018, for the first time in...

April 27, 2020
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24Apr

UK government plans to grant phone-hacking powers to the Pensions Regulator (and others)

UK ministers want to extend the Investigatory Powers Act, better known as the Snooper’s Charter, even further, according to draft legislation that would gift phone-hacking and web-history combing capabilities to five new public bodies, in addition to the more than 50 that already have access to the sprawling surveillance powers. Read also UK. Coronavirus crisis hits occupational pension schemes The bodies poised to receive new comms-hacking powers are a motley crew consisting of the Pensions Regulator, the Civil Nuclear Constabulary...

April 24, 2020
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24Apr

Tesla appoints former head of Japan’s Government Pension Investment Fund to its board

Tesla has appointed Hiromichi (Hiro) Mizuno, former head of Japan’s Government Pension Investment Fund, to the board of directors. Today, Tesla announced that its board has authorized the number of directors on the Board of Directors to increase from nine to 10 in order to appoint Mizuno. Mizuno was executive managing director and chief investment officer of Japan’s Government Pension Investment Fund until last month. He was recently praised by Tesla CEO Elon Musk when he...

April 24, 2020
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24Apr

Coronavirus will make US cities feel the pressure of pension debt

Municipal pension debt is among the many aspects of the economy that have been severely impacted by the coronavirus pandemic. COVID-19 not only exposes, but also further threatens the already-weak fiscal health of municipal retirement plans. Inaction on this front could mean insolvent pension plans dragging some of the nation’s largest cities into bankruptcy. After all, when the stock market takes a hit, so do pensions. This is because most of the typical pension funds’ income is from returns...

April 24, 2020
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23Apr

Ghana’s Social Protection And Public Choices In The Days Of Covid-19

We cannot know how society protects its weakest and vulnerable, those at the bottom of society from deprivation until a catastrophe such as COVID-19, the 'unseeable, undead, unliving blob', to use the words of Arundhati Roy, is unleashed on us. Read also South Africa. The dichotomy between what pension scheme members want and what they get Ghana has a sub-optimal social protection system, its inadequacy due to our informal and poor information system. COVID-19 has amplified these weaknesses, unleashing a...

April 23, 2020
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23Apr

UK. Coronavirus crisis hits occupational pension schemes

Members of generous final-salary workplace pension schemes could see their guaranteed benefits jeopardised by the Covid-19 pandemic. Many such schemes are in deficit: they lack the money to make good on all the pension promises made to employees . In the short term, the outlook has improved. The Pensions Regulator has now given employers longer to make up this shortfall since many firms are suffering from the pandemic. This will help employers squeezed by the virus. But...

April 23, 2020
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23Apr

South Africa. The dichotomy between what pension scheme members want and what they get

The one thing an investment linked living annuity (also known as a living annuity, or illas) does not do is give pensioners a secure income flow. Few pensioners are likely to be financially secure until death. The advent of Covid-19 and the junking of South Africa’s debt makes it far worse when share prices and dividend payments drop. Most living annuity pensioners had already received a serious body blow even before the virus and the downgrade of South...

April 23, 2020
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23Apr

EBRI: Pandemic likely to worsen U.S. retirement savings deficit

The impact of the coronavirus pandemic on U.S. retirement readiness using middle-of-the road risk assumptions appears to be manageable, according to projections by the Employee Benefit Research Institute. EBRI estimates that the $3.68 trillion aggregate retirement deficit for all U.S. households age 35-64 will increase by 4.5% or $166.2 billion if market losses for the year are equivalent to first-quarter 2020 losses, a risk assumption that EBRI defines as intermediate. Under EBRI's pessimistic scenario, that in which market losses...

April 23, 2020
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