We study the impact of economic policy uncertainty (EPU) on public pension spending (PPS) in Japan from 1997 to 2024, employing the autoregressive distributed lag (ARDL) approach alongside kernel-based regularized least squares (KRLS), a machine learning method that does not require a predefined functional form. The results show that higher EPU is negatively associated with PPS in the long run, while short-run estimates indicate a significant positive association. The KRLS results show a somewhat larger negative association compared to the ARDL model, and estimates across EPU quantiles indicate that the negative association varies across the EPU distribution. Heterogeneity analysis further shows that the negative association differs between the pre- and post-Abenomics periods and strengthens during major global shocks, particularly the 2008 global financial crisis and the COVID-19 pandemic. Based on these findings, we discuss the policy implications and identify directions for future research.

Financial stability in later life remains a pressing concern in the UK as limited pension contributions leave many individuals financially insecure in retirement. While research has mostly focused on work histories to explain the differences, other structural, cultural, and personal factors have received less attention. Using a lifecourse and capabilities approaches, the aim of this article was to explore factors that influence financial planning for later life. The study employed a photovoice methodology with sixteen participants (forty-five-plus years) from Hampshire, England. The study offers novel insights into factors that either positively or negatively affect financial resilience in later life or the ability to plan for it (financial mindsets and behaviours; access to financial knowledge and guidance; prioritising immediate needs in the cost of living crisis; imagining retirement and preparing financially). The study emphasises the importance of de-homogenising individuals’ experiences and highlights the need for lifelong financial education.

Malaysia is a rapidly ageing country. Relative to the United Kingdom, its social protection systems are underdeveloped. What is more, its political structure and social practices are different from those of the United Kingdom. Accordingly, the political economy of ageing seems to suggest a stark contrast when the two countries are considered alongside one another. Nevertheless, when programmes concerning income for the retired and the provision of care services for the frail elderly are considered, there are more similarities than might have been expected. Both countries face problems with inadequate pension coverage, and the paper considers how more of the self-employed might be brought into savings plans. In both countries, there is debate on whether pension savings should be directed towards investments in the domestic economy. Both countries face a rapid increase in the number of the ‘oldest old’—those most likely to need support, and policymakers are asking themselves how provision for these people should be improved. This article points out how fiscal constraints have led policymakers in the United Kingdom as well as in Malaysia to encourage the family to increase the part they can play. But in both countries, family members, especially women, are no longer willing, or even able, to carry out ‘traditional’ roles. There are lessons to be learnt in both directions. Moreover, in both countries, more attention should be devoted to understanding and explaining the economic and societal consequences of demographic change.

Pension policies are an increasingly important topic in British elections. This paper discusses what the first year under a Labour government has meant for pension policy, drawing on the Labour Party’s pre-election pledges, before critically considering future directions of pension policy and areas not currently addressed by the Labour government, or where policies could go further. The paper argues that structural inequalities in the labour market and the pension system persist, with consistent evidence of gender and ethnic inequalities in labour market participation, the nature of such participation, pension outcomes, and a range of financial and non-financial wellbeing indicators. Placing adequacy and fairness at the heart of Labour policy can send a strong message on the government’s part of understanding the complex interactions of opportunities and costs across the lifecourse for individuals from diverse backgrounds, and anticipating further demographic and socio-economic changes in the British society and economy.

This research presents the design, pricing, and consumer testing results of a potential private financial product that integrates retirement savings with social care funding through contributions to a supplemental defined contribution pension scheme. With this product, some contributions will be earmarked specifically to cover social care expenses if needed post-retirement. Our research indicates that offering benefits that address both retirement income supplementation and social care funding in a combined approach is appealing to consumers and could help overcome behavioural barriers to planning for social care. As with established defined contribution schemes, this product is designed for distribution in the workplace. Employees can contribute a portion of their earnings to their pension accounts. Employers may partially or fully match these contributions, further incentivising participation. In addition to financial support, participants will gain access to social care coordination services designed to facilitate ageing at home. These services will help retirees navigate care options, coordinate necessary support, and optimise the use of their allocated social care funds, ultimately promoting independence and well-being in later life.

In 1987, the United Nations Brundtland Commission defined sustainability as “meeting the needs of the present without compromising the ability of future generations to meet their own needs.” In recent years, the sustainability agenda has grown in importance, with many countries, regulators, industries shifting to implement sustainable practices. For retirement funds this means providing a lasting income in retirement for members, whilst ensuring a positive contribution to society and the environment. Retirement funds, with long-term liabilities, are therefore well placed and can play a significant role in contributing to the overall objective. This paper explores how retirement funds in various countries are progressing this agenda. We then introduce a sustainability reporting index, which measures the breadth and quality of how retirement funds can report on pricing in social and environmental externalities in the provision of a pension promise. The sustainability reporting index includes the financial inclusion aspects of retirement funds as well as how social and environmental externalities can be factored into the running of a fund and how its assets are invested. It explores the key areas that need to be monitored, the types of data required and the types of analytics that can be used by various stakeholders. The sustainability reporting index is intended to provide a benchmark against which various stakeholders can measure the effectiveness of their approach in pricing in these externalities. Actuaries of retirement funds can use the framework to go beyond focussing purely on the financial aspects of a fund, incorporating material non-financial aspects to ensure the provision of a sustainable pension income.

For about a decade from the late 1990s until the early 2000s, the Chinese state commanded loss-making and other small- and medium-sized enterprises to dismiss tens of millions of older (over age 35), unskilled workers, as it prepared to join the World Trade Organization and the global market. These uncompetitive laborers were left with little or no income or benefits, and many protested. In response, the regime instituted a so-called “social assistance” program, which, this paper shows, did little to address the predicament of these people; the legacy of their layoffs remains to this day.

This report explores key considerations in relation to adopting a dynamic discount rate funding approach and the impacts of doing so in a range of areas, including funding volatility, investment strategy and end game objectives. It considers the advantages and disadvantages of this approach from the perspective of a range of stakeholders and the challenges that need overcoming in order to fully implement and support the approach, for example data challenges and the new skills required in the industry. The report includes sample modelling to highlight the practical issues that arise when adopting this approach. It describes a step-by-step approach for assessing the risks to be considered when determining an appropriate level of assets to provide funding for a sample set of pension scheme cash flows, as summarised in the table below.

It also considers how a dynamic discount rate approach fits within the proposed future funding regulations. Finally, the report puts forward recommendations for the IFoA, Scheme Actuaries and TPR.

Consequences of schemes adopting a dynamic discount rate approach could include very different investment strategies with investment in a wider pool of assets, less use of leveraged Liability Driven Investment, fewer schemes targeting buy-out as their end game strategy and an increase in technical work for actuaries in advising on the optimisation of asset and liability cash flows.

I agree that a good pensions system should embody some form of collective risk pooling and that this would be to the advantage of everyone. There are some difficult issues of adverse selection to be solved, however. Moreover, egalitarian concerns are of crucial importance in most countries and they require to go further than collective risk pooling and to take into account that society is more than a system of self-interested monetary transfers between and within cohorts.

This paper is a contribution to a symposium on Michael Otsuka’s book, How to Pool Risk Across Generations. Following Otsuka, one may distinguish three distinct systems of cooperation within a standard pension arrangement: the retirement system, the longevity risk pool and the investment risk pool. It is important to observe, however, that only the retirement system constitutes a genuine system of intergenerational cooperation, the other two are essentially intragenerational, in that they pool risks among members of a cohort. Otsuka is faulted for being occasionally less than clear on these distinctions.

Michael Otsuka argues that collective pension schemes are forms of social cooperation on equal terms for mutual advantage and thus, matters of social justice. In this way Otsuka wants to understand collectively funded pensions in Rawlsian terms. I argue that not all forms of social cooperation are the same and that the specific kind of social cooperation Rawls has in mind is, in at least three central respects, different from the kind of social cooperation involved in the collective pension schemes Otsuka describes.

This article examines premature withdrawals from pension funds that were initiated as responses to the COVID-19 pandemic. It looks at withdrawal programmes both in emerging market and in advanced economies. Although measures might have been expedient in countries where social protection systems (social assistance and job furlough schemes) are relatively underdeveloped, they could also be regressive. Furthermore, they undermined the concept of pension funds as retirement income resources and, in some cases, they might threaten people’s living standards once they became old. The paper also suggests that such withdrawal programmes have a populist flavour.