April 2020

06Apr

US. Underfunded public plans facing a new round of woes

The coronavirus has increased pressure on underfunded public pension plans that were already facing significant stress before the crisis. Not only have plans' investment portfolios taken double-digit losses as a result of the pandemic, but government plan sponsors will need to increase their contributions at a time when revenues are down and expenditures are up. Read also US. Some companies are cutting 401(k) matches because of the coronavirus "This has put a lot of strain and stress on pension deficits,...

April 6, 2020
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03Apr

The Political (In)Stability of Funded Pension Systems

By Roel M. W. J. Beetsma, Oliwia Komada, Krzysztof Makarski, Joanna Tyrowicz We analyze the political stability of capital funded social security. In particular, using a stylized theoretical framework we study the mechanisms behind governments capturing pension assets in order to lower current taxes. This is followed by an analysis of the analogous mechanisms in a fully-edged overlapping generations model with intra-cohort heterogeneity. Funding is efficient in a Kaldor-Hicks sense. Individuals vote on capturing the accumulated pension assets and...

April 3, 2020
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March 2020

24Mar

Australia’s pensions industry in urgent talks on coronavirus crisis changes

Australia's A$3 trillion ($1.72 trillion) pension industry was not consulted on the federal government's decision to allow the unemployed and sole traders early access to retirement savings and is now in urgent talks about the move, sources said. Read also New ZealandTime to rethink everything especially super policy Prime Minister Scott Morrison and Treasurer Josh Frydenberg on Sunday revealed a A$66 billion fiscal stimulus package including measures allowing workers to take up to A$20,000 out of their superannuation savings over...

March 24, 2020
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09Mar

World Bank: Overcoming Major Barriers in U.S. Reverse Mortgage Market

Reverse mortgages have significant potential in serving aging parts of the global population, and can allow more seniors to make financial ends meet in retirement since loan proceeds can be applied to a multitude of scenarios. However, some key market realities and roadblocks with universal application to multiple parts of the world have kept reverse mortgages from flourishing in both well- and under-developed economies alike. This is according to a newly-published policy paper authored by researchers Peter Knaak, Margaret Miller...

March 9, 2020
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02Mar

New Zealand. Reverse mortgages boom as pensioners opt to put retirement on the house

Low interest rates and high house prices are prompting more retirees to take out a reverse mortgage against their homes. Reverse mortgages - primarily offered in New Zealand by Heartland Bank - allow people to borrow a sum of money against their houses. They do not have to make any repayments until the house is sold. But interest accrues and compounds while the loan is not being repaid, so the amount that finally falls due can be a lot...

March 2, 2020
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February 2020

05Feb

FTSE 350 pension deficit increases sharply as UK exits EU

Mercer’s Pensions Risk Survey data shows that the accounting deficit of defined benefit (DB) pension schemes for the UK’s 350 largest listed companies increased from £40bn at the end of December 2019 to £57bn on 31 January. Liability values increased by £34bn to £916bn compared to £882bn at the end of December. The increase was primarily driven by falls in corporate bond yields. Asset values were £859bn (an increase of £17bn compared to the corresponding figure of £842bn at...

February 5, 2020
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January 2020

08Jan

Ghana: Pay Employees’ Contributions Promptly – Ssnit Boss to Employers

The low level of compliance by employers to pay contributions of their employees is a threat to the sustainability of the pension scheme, Dr John Ofori-Tenkorang, Director-General of the Social Security and National Insurance Trust (SSNIT) has said. "Often, less than 50 per cent of employers pay their workers' contributions by the 14th of the ensuing month, which is the deadline for contributions payment," he said. Read Also Ghana. SSNIT To Pay ¢243m Pension In 2020 Dr Ofori-Tenkorang was speaking...

January 8, 2020
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06Jan

US. Public Pension Funding Crisis: Why Should Today’s Workers And Retirees Pay The Price?

Here are some excerpts of interest from a May 26, 1965 Chicago Tribune story, “Police, Fire Pensions Tabled”: “Three important police and firemen’s pension bills appeared defeated today but efforts may be made to revive one which would consolidate 335 pension systems outside of Chicago. . . . “Robert Erickson, a spokesman for the Civic federation, Chicago taxpayers’ organization, was happy when two tax-increasing bills were tabled by their sponsors. “One would have required a property tax boost to...

January 6, 2020
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November 2019

25Nov

UK. University staff strike over pensions and pay

Students across the UK face disruption as lecturers and support staff in 60 universities start an eight-day strike. Members of the University and Colleges Union (UCU) are taking action in two separate disputes, one on pensions and one on pay and conditions. The strikes will affect almost half of all UK universities. The universities say strikes are not the way forward and promise to do all they can to minimise the impact of industrial action on students. In addition...

November 25, 2019
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22Nov

Kenya. Pension crisis as 50,000 government staff retire

The retirement of about 50,000 civil servants is burdening taxpayers after the pension bill jumped by 63.03 percent or Sh10 billion in the first four months to October as the Treasury raised the red flag over the rising expense. Read also Less than 10pc Kenyans to retire comfortably on pension Treasury data shows that public pension expenses stood at Sh27.8 billion in the four months to October compared to Sh17.06 billion a year earlier — making it the fifth largest...

November 22, 2019
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