Structural Reforms for Public Pension Schemes

Announcements from the European Actuarial Academy organiser: Traditionally, public pension schemes managed by social security organizations are financed by a PAYG (pay as you go) mechanism and use a Defined Benefit logic. This double characteristic (PAYG + DB) has been massively challenged these last decades in the well-known context of ageing. The demographic evolution will impact directly the PAYG scheme and the DB nature, protecting by definition the benefits, generates an unavoidable increasing of the contributions. In order to address this financial threat, different countries have introduced or proposed various strategies of reforms, including structural reforms. Among the main alternatives to classical schemes, we can think of the NDC system (Notional Defined Contribution), the point system or individual saving accounts. The introduction of these new mechanisms has been mainly motivated by financial sustainability arguments. But other constraints or goals of a public system must not be forgotten. In particular, the following issues motivate deep actuarial analysis:

• equilibrium between financial sustainability and social adequacy;
• intergenerational risk sharing;
• actuarial neutrality in case of early retirement;
• longevity heterogeneity driven by socio economic conditions. 

The web session is open to all interested persons, especially for pension actuaries and everybody motivated by the future of our pension systems.

Technical requirements: Please check with your IT department if your firewall and computer settings support web session participation (the programme Zoom is used for this online training).

The objective of this web session is to present various experiences of structural reforms of public pension schemes such as NDC (notional account) or point systems and to analyze these techniques in terms of fair equilibrium between financial sustainability and social adequacy. This analysis will motivate to introduce intermediate approaches between classical DB plans and NDC notional accounts, using inter-generational risk sharing of the aging cost and automatic adjustment mechanisms. The influence of longevity spreads between different socio economic groups will also be addressed in terms of intra generational fairness as well as the actuarial neutrality in case of flexible retirement age.

Click here to make a reservation. Your early-bird registration fee is € 300.00 plus 19% VAT for bookings by 13 December 2021. After this date, the fee will be € 400.00 plus 19% VAT.