Report: Towards a New Design for Workplace Pensions
This report provides a framework for modern pension solutions, linking the best of the defined benefit and defined contribution world.
- Four key features were identified as requirements for a good pension system: adequacy, sustainability, reliability and efficiency.
- Adequacy can be broadly defined as producing a good financial outcome for beneficiaries.
- Sustainability has to be supported by a good supervisory framework seeking a balance between protection of beneficiaries, prudential supervision and the need for pension plans to invest in return seeking investments.
- Reliability can help to increase trust in a pension plan, through good governance, transparency and communication.
- Efficient and effective administration is necessary. This is integral to delivering good pension outcomes.
Looking to the future, PensionsEurope intends to launch a follow-up report to this one, which looks at how these principles might be applied, including the impact on the employer and the employee, as well as the political and regulatory impact.