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Traditional defined benefit pension plans sponsored by state and local governments are dramatically underfunded, requiring large infusions of public funds in future years if they are to deliver promised benefits. [...]

FOR MANY TEACHERS, a defined-benefit pension plan at retirement is hardly a 'fringe' benefit--rather, it is a long-anticipated payoff at career's end, after years of modest take-home pay. Public school [...]

While the governance of pension schemes, and the risk this poses for pension savers, is a prominent issue in current pension debate in the UK, this paper places that debate in, arguably, the more important context of the governance of individual behaviour. Using the concept of governmentality as a means of interpreting the course of recent UK pension policy and its attempts to influence individual saving behaviour, it critiques that policy. The paper then goes on to consider the effect of the introduction of personal accounts upon the pensions landscape, and in particular its potential to push forward the government's recent approach to pension provision. It argues that these reforms, rather than furthering individual saving for retirement, may alternatively create the very real possibility of undermining it. Keywords: pensions; governance; governmentality; retirement; risk; behavioural finance. Background: governance of UK pension schemes and the paradigm shift DOI: 10.1080/03085147.2010.510683

The transition from defined-benefit to defined-contribution occupational-pension plans has placed a premium on the participants' or contributors' decision-making competence. Their attitudes to risk and their responses to available investment options can have far-reaching implications for their retirement income. Behavioural research on risk and uncertainty has raised understanding of the limits of individual decision-making, but the social status and demographic characteristics of plan participants may also affect risk perception and pension choices. By studying a random sample of the British adult population, this paper explores the significance of socio-demographic characteristics for pension-related risk attitudes. It is demonstrated that pension-plan participants do not appear to understand the risks associated with different types of retirement savings and pension plans. The paper also shows that the gender, age and income of plan participants can give rise to distinctive risk propensities, and that marital status and, in particular, whether a spouse also has a pension can also have significant consequences for household risk preferences. These results have implications for those segments of the population that are disadvantaged in the labour market. Employer-provided pensions' education and information programmes may have to be more basic and more closely tailored to the social status of pension plan participants than hitherto assumed or hoped. KEY WORDS--Gender, pension risk, socio-demographic status, spousal entitlements.

CASE DESCRIPTION The primary subject matter of this case concerns changes in accounting for defined benefit pensions and other postretirement benefit plans proposed and promulgated by the Financial Accounting Standards [...]

Abstract In this paper, we analyze a majority voting process on the earnings-related part of pension benefits in a Social Security system with flexible retirement. We show that the aging [...]

Financialization can be defined as the growing and systemic power of finance and financial engineering and the financialized techniques have helped to cement the pact between the financial elite and the corporate elite. The different aspects of financialization at the level of corporation and some of the fourth-dimensional operations of hedge funds, private equity, investment banks and pension funds, as well as some of the misleading aspects of financial practice are examined.

The UK Pension Protection Fund (PPF), established by the 2004 Pensions Act to protect beneficiaries of defined benefit pension schemes when the sponsor becomes insolvent and the scheme is underfunded, is required to finance itself through a levy on participating schemes. In July 2005, the PPF issued a consultative document setting out its proposal for the structure of the levy. In this paper, we provide a critique of the proposal and, in particular, its heavy reliance on securing levy income from the weakest schemes. We propose an alternative structure for the levy that recognises the limits on capacity to pay and also mitigates some other undesirable features of the proposal.

Abstract At what point does an IRA with an early withdrawal penalty accumulate more wealth than a fully taxable investment? This paper models breakeven holding periods, allowing tax rates to [...]

The aging population of the United States of America and the urgent need to have a better pension model to tackle the issue is emphasized. By the year 2030 retired persons will be around 28% of the total population, mainly due to the aging baby boomers, immigrants, growing life span and lower birth rates.

The empirical retirement literature measures individual responses to variations in income flows due to public transfers, private individual or employer-provided pensions. We estimate a model accounting for the incentive effects from these sources. A dynamic structural model is extended to allow both individual and employer heterogeneity. This is applied to a Danish matched panel of workers and establishments, spanning a period of reforms to a public early retirement programme. Employer-specific compensation is found to be an important determinant of work and retirement income flows. Employer effects on retirement age are only found among sub-samples where access to public transfers is limited. JEL classification: J26; C61; C23; C25 Keywords: Retirement; Pensions; Matched employer-employee panel data

The author posits that pension finance problems occur from both population aging and a reduction in retirement age. Social security systems partly explain the retirement age reduction; discussion includes an examination of the political barriers to reforms.

The article examines public pension reform strategies. These include the development of formula-based actuarially fair pension programs, parametric reforms to currently existing programs, and larger pre-funding of pensions and expanded second-tier private components.

Pensions crisis in UK is the result of rising life expectancy, falling birth rates and fewer active work-force to support the elderly. The pros and cons of existing pension scheme are examined. The proposed Pension Credit plan is expected to mitigate the pensioners problems after retirement without burdening the treasury.

An uncertain future In the 1960s, 70s and 80s many nurses cashed in their NHS superannuation payments. Now, as those who did approach retirement age, the consequences are becoming clear. [...]

General Motor's problems funding its pension fund is typical of companies that have relied too heavily upon financial returns from the stock market. When the stock market drops, stock market-funded pensions become riskier. Many companies fund their pensions in this manner, based upon accounting pressures and/or advice.

Social Security is a defined benefit (DB) pension plan. Proposals for 'reforming' Social Security suggest replacing it with a defined contribution (DC) savings plan. This paper compares the financial and non-financial aspects of DB pensions and DC savings plans, and discusses how changing financial and labor markets affect the interpretation of these plans. Recent wage stagnation has strengthened the arguments for 'reform,' but a return to the more historical pattern of wage growth would undermine the arguments for reform. Keywords: Social Security; Pensions

Contracting-out was introduced in the United Kingdom in 1978 as part of the arrangements for the State Earnings-Related Pension Scheme (SERPS) in order to avoid duplication with the existing well-developed defined benefit occupational pension plan sector. Members and sponsors of contracted-out schemes were able to save on their social security contributions in recognition of the fact that they were accruing equivalent benefits through an occupational pension plan. Later on this concept was extended to those with individual money purchase pension plans. This article considers a brief history of contracting-out, the principles of contracting-out, some problems associated with contracting-out, the implications of the introduction of stakeholder pensions and State Second Pension, and the latest rebate review and rebate orders. It examines how U.K. pensions policy since 1978 has been based on a partnership between social security and private pension plans. [Article copies available for a fee from The Haworth Document Delivery Service: 1-800-HAWORTH. E-mail address: Website: KEYWORDS. Contracting-out, social security, SERPS, stakeholder pensions, personal pensions

This paper takes the old-age pension system in Israel as a test case to examine the implications of proposals for pension reform now being debated or implemented in many welfare states. For over a decade, high on the agenda of decision-makers on both national and international levels, there has been the notion of moving towards a changing `partnership in pensions' or, to put it more bluntly, towards greater privatisation of social security. Virtually since its emergence in the 1950s, the Israeli old-age pension has been based primarily upon a mix of low universal state pensions and income-related private occupational pensions. This paper compares the British and Israeli social security systems for older people in the wake of the reforms recently introduced in Britain and analyses the implications of the Israeli structure on the distribution of social security spending and on the wellbeing of different categories of older individuals. KEY WORDS--pensions, Israel, partnership in pensions, social protection.

In examining the efficacy of institutional investors overseeing corporate pensions, it is found that institutional investors and employees with pensions may have a conflict of interest.

This article discusses the social problems posed by the need to provide pensions for the elderly in Russia during the crises years of the 1990s. Issues include the reductionin pension size compared to the magnitude of the minimum subsistence level, delays in pension payments, and the elimination of differentiation in the size of payments.

An overview is presented on the feminization of poverty in Russia. Data from the research show an increasing disparity between men's and women's wages, with women earning 56% of men's wages during 1999, which in turn has a pronounced effect on pension income.

It has long been known, from the work of Samuelson and Aaron, that if (approximately) the sum of the population and real earnings growth rates exceeds the real interest rate, all individuals can be made better off by using a pay-as-you-go pension scheme. The basic overlapping generations model that is typically used to examine such intergenerational transfers makes no allowance for labour supply responses to taxes and transfers, and so cannot be used to examine optimal tax and pension levels. The present paper allows for labour supply effects, whereby a tax imposed to finance current pensions introduces distortions to labour supply and a reduction in the tax base. The optimal proportional tax rate, and therefore the optimal combination of private savings and social transfers, is derived in terms of the time preference rate, the taste for leisure, real interest and productivity and population growth rates. It is found that the condition under which the optimal tax is positive is the same as the Samuelson-Aaron condition. A crucial ingredient in obtaining this result is an assumption that pension levels are adjusted in line with the growth of wage rates rather than, for example, being held constant in real terms. This in turn is found to imply that earnings grow at the same rate as the wage, so long as preferences are such that leisure can be expressed as a proportion of full income.

This study evaluates the positive and negative features of the German public pension system and discusses three reasons for its increasing perceived and real difficulties: maturation, negative incentive effects, and the problems of demographic change. The German system in its current form may be able to limp through the coming decades but will cease to be the exemplary Bismarckian machine that has created generous retirement incomes at reasonable tax rates. Current policy proposals are insufficient and a few but incisive design changes and some degree of prefunding could rescue the many positive aspects of the German retirement insurance system.