December 2020

10Dec

Mexican Congress passes major reform to boost pensions

The Mexican Congress late on Wednesday passed one of the biggest overhauls to the country's pension system in years, boosting retirement benefits and reducing workers' mandatory contribution times, in a victory for President Andres Manuel Lopez Obrador. Read also The Consequences of Long-Term State Pension Underperformance The initiative, which the government originally set out in July, will lower to 1,000 from 1,250 the number of weeks workers must have paid in to claim retirement benefits. Read also Chilean lawmakers...

December 10, 2020
News, Slider, ,
Read more...
02Dec

Proposed Fee Cap for Mexican Pension System Could Bring Challenges

On Sept. 25, 2020, a Mexican Pension System (SAR) reform bill was submitted to the congress containing enhancements previously proposed by Mexico’s president. The bill also proposes a cap on management fees charged by pension fund managers (Afores) that would reduce annual fees by over 40%. The SAR continues to undergo changes aimed at improving the projected adequacy of pension savings. The target-date fund framework aims to improve investment returns. Contributions would increase to 15% under the current reform...

December 2, 2020
News, Slider, , ,
Read more...

November 2020

30Nov

China’s plans to hike retirement age from 60 fuels public discontent

China is making a new push to raise one of the world’s lowest retirement ages as it tries to cope with a rapidly aging population, a move that’s already fueling public discontent and will test the Communist Party’s ability to implement reforms. The ruling party alluded to the change earlier this month when it released an outline of its five-year economic plan, which included a recommendation to “implement postponing the retirement age.” Specific measures in the plan are due...

November 30, 2020
News, Slider, , , ,
Read more...
26Nov

Switzerland. Government hopes for ‘first successful pension reforms’ of the century

In summer 2019 the social partners agreed on a reform of the Swiss occupational pension scheme. The government on Wednesday adopted this compromise unchanged; the ball is now in parliament’s court. Occupational pensions have been under pressure for a while as a result of rising life expectancy and low interest rates. Following the rejection by voters of the pension reform in September 2017, the government tried again, focusing on the second pillar (based on occupational pension plans and accident...

November 26, 2020
News, Slider, ,
Read more...
13Nov

The $75 Billion UN Pension Fund: Kicking Reforms Down the Road

A new governance study has confirmed what many United Nations Joint Staff Pension Fund observers have long surmised: there are significant variances between the fund’s own operations and best practices and those of pension funds elsewhere. The areas reviewed by Mosaic Governance Advisors, who prepared the study, include standards of professional and ethical conduct, conflicts of interest and oversight of culture. There were certainly clues as to problems: two internal audits conducted by the UN Office of Internal Oversight...

November 13, 2020
News, Slider, ,
Read more...
12Nov

German pension system requires tweaks to stand future challenges

The German retirement system will have to continue to adapt to new circumstances through a series of changes to sharpen its private and occupational pensionsprovision, according to panellists speaking at the virtual Handelsblatt annual conference on occupational pensions this week. Measures should be adopted to make savings products “more profitable than today”, if the aim is to rely on private pension provisions, said Dorothea Mohn, head of the financial market team at the organization for the protection of consumers...

November 12, 2020
News, Slider, , ,
Read more...

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
Books, Regulation, System Sustainability, , , , ,
Read more...
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
News, Slider,
Read more...
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
News, Slider, , , ,
Read more...
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
Articles, Labor Market, Regulation, , , , ,
Read more...