Advance Funding of Pensions
International Reform Monitor, Special Issue / October 2000
1st edition 2000, 56 pages
out of stock
The current reports from the "International Reform Monitor" project clearly demonstrate that industrialized countries are reforming their retirement systems in response to demographic trends.
An ever-increasing number of countries are introducing advance-funded elements to strengthen the financial security of their entire pension system. These advance funding reforms address the rising costs of pension provision, which are likely to occur as the population ages. Both the OECD and World Bank have voiced strong support for pension funding, while the ILO and ISSA have been more critical of such programs.
The Advance Funding of Pensions special issue examines fundamental questions of pension financing. What degree of advance funding is desirable? Should contributions be mandatory? Should there be an obligation to annuitize pension savings? An overview of the current pension systems in 15 OECD countries is supplemented with the opinions of country experts on what would be the optimal level and design of pension funding in their countries. On many fundamental issues, there emerged a broad consensus among the experts surveyed.
Moreover, this special issue describes pension reform plans that have recently been implemented to increase advance funding in the retirement system's various segments. Although considerable reform has taken place in all countries, experts agree that the legal framework could still be improved.
The reform proposals discussed here highlight many valuable approaches, which may be of particular interests to those countries planning further advance funding reforms. The issue also contains a comprehensive list of references for those desiring additional information. Internet links to the 15 countries' relevant institutions are also provided, along with several background articles.
A detailed description of the reforms discussed here and further information on pension research is available at www.reformmonitor.org.
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