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by twic
2408 days ago
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Your assumptions are basically all wrong. The pension administrator is not corrupt. Their current assets are 101% of what they need to be to cover their liabilities, assuming they can use returns on the assets to pay for the liabilities, given some standard set of assumptions about investment returns [1]. The "shortfall" is about a "wind-up basis", or "buy-out basis", which means assuming that the scheme sells its assets and uses the proceeds to buy annuities. Buying annuities is a really expensive way to provide a pension, so their current assets aren't enough to cover their liabilities this way. But they're not going to do this! Neither the administrator nor the members want to do this! The private people are not arguing over the private money, they're all perfectly happy with each other. But the law requires that a pension fund has enough assets to do this! Why does the law require this? I have no idea. I'd have to dig out Hansard or white papers from the mid-'90s to find out, and that is a bridge too far. But it seems clear that the problem here is entirely derived from government regulations which don't align with what the private people involved want. [1] https://www.theyworkforyou.com/debates/?id=2018-01-11a.578.5 |
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And I'd probably agree as a numeric argument. But I still don't see that as an argument against "government". And I surely don't see that as an argument against the idea of regulating risk in pensions, given the propensity of these things to go belly up over history.