October 2020

29Oct

Pension Reform in Mexico: Guiding Principles for Creating a Sustainable and Balanced System for Private Sector Workers

By Guillermo Zamarripa & Gustavo A. Del Angel From 1995 to 1997, Mexico engaged in a major pension reform. With that change, the system migrated from a pay as you go defined benefit model to a defined contribution one. The pension system reform permitted a sustained increase of financial savings in Mexico from 1999 to 2019. Savings managed by the pension funds -the Afores1- reached 16.6% of GDP as of the end of 2019. However, after more than two...

October 29, 2020
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22Oct

Kenya mulls reforms to attract pension funds to invest in infrastructure projects

Kenya mulls reforms to attract pension funds to invest in infrastructure projects. Kenya is considering a number of legal reforms in order to attract both foreign and domestic pension funds to invest in infrastructure projects, a government official said on Wednesday. Julius Muia principal secretary, National Treasury told a virtual meeting that the government is keen to tap on private sector resources in order to close the infrastructure funding gap. "If there are laws or policies that will make it easier for...

October 22, 2020
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21Oct

Mexico. López Obrador faces pension funds’ ire with commissions cut plan

Plans by Mexican President Andrés Manuel López Obrador to force fund managers to cut their fees as part of a pension reform have prompted threats of litigation. Read also Chile’s pension funds join global gold ETP rush Private pension funds would have to cut their commissions almost in half to 0.54 percent, from 0.92 percent, according to a bill sent to Congress in September, which is expected to be approved in both chambers in the next weeks. Read also COVID-19...

October 21, 2020
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15Oct

Workforce Aging, Pension Reforms, and Firm Outcomes

By Francesca Carta, Francesco D’Amuri, Till Von Wachter Raising statutory retirement ages has been a popular policy to increase the labor supply of older workers in the face of population aging. In this paper, we quantify the effect of a sharp and unexpected increase in retirement ages on firms’ input mix and economic outcomes using Italian administrative and survey data on employment, wages, value added and capital. Exploiting information on lifetime pension contributions for the universe of employees, we...

October 15, 2020
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08Oct

Ireland. State’s pension scheme for public servants ‘more sustainable’

Over 40% of the government's 345,000 employees now belong to the less generous pension scheme introduced for new entrants in 2013, according to an expenditure review issued by the Department of Public Expenditure and Reform today. The review describes the introduction of the state's Single Scheme for public servants' pensions as "arguably the most fundamental reform to date" which is set to put the state pension bill on a sustainable footing. Before its introduction, there were fears...

October 8, 2020
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August 2020

24Aug

Philippines. Dominguez pushes for reforms in corporate pension system

The Capital Market Development Council chaired by Finance Secretary Carlos Dominguez III is considering reforms in the corporate pension system, including the recommendation by the Fund Managers Association of the Philippines to require the partial or full funding requirement of retirement plans for private sector workers. Dominguez said over the weekend the council consulted the Department of Labor and Employment on FMAP’s recommendation. He said the recommendation would help provide sufficient funds for the pension or retirement plans...

August 24, 2020
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20Aug

A step closer to retirement reform in South Africa

By Jerry Botha, managing partner, and Jean Du Toit, head of tax technical at Tax Consulting South Africa As announced in the Budget Speech, any South African leaving in future will be subject to a much stricter process from 1 March 2021 onwards. But there was also a surprise 3-year lockup announcement for anyone with a South African pension fund, seeking to leave South Africa. This appears a sign of things to come for private pensions in South Africa....

August 20, 2020
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17Aug

Ireland. Kicking pensions can down the road will cost us all

During this pandemic the Government must not ignore the urgent need for pension reform. After protracted negotiations to form a new Government, urgent attention is now required to reform the pension system and protect the retirement security of future pensioners. The underlying issues are clear: our population continues to age; the cost of providing State pension support is growing; and the participation rates and adequacy of private pension saving remain too low. Experience shows that longer-term issues such as...

August 17, 2020
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14Aug

Public Pension Reforms and Fiscal Foresight: Narrative Evidence and Aggregate Implications

By Huixin Bi Sarah Zubairy We explore the evolution of pension policy across countries and investigate the macroeconomic impact of pension structural reforms in recent decades, in particular those with implementation delays. We first document chronological changes in pension policy for ten OECD countries between 1962 and 2017. The new data set uncovers that changes in pension policy come in waves, with a rapid expansion of pension systems between 1960s and 1980s followed by a wave of retrenchments since...

August 14, 2020
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13Aug

Call for urgent reforms to pension funds in Bahrain

The pension funds need to undergo urgent reforms in order to be saved before it’s too late. Social Insurance Organisation (SIO) chief executive Eman Al Murbati gave a presentation on the future of pension funds. Read also Switzerland. Pension reform initiative runs out of steam at early stage She was speaking at an event hosted by the National Communication Centre (NCC) as part of their ‘Conversations with a Government Official’ series. Read also Thai Airways must pay B5.4bn in pensions Ms...

August 13, 2020
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