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The optimal allocation of pension risks in employment contracts
— a report of research carried out by Dr David McCarthy of the Tanaka Business School at Imperial College London on behalf of the Department for Work and Pensions | | Author(s) | David McCarthy |
| Corporate Author | Tanaka Business School, Imperial College London; Department for Work and Pensions - DWP |
| Publisher | Corporate Document Services, Leeds, 2005 |
| Pages | 106 pp (Department for Work and Pensions Research report, no 272) |
| Source | Corporate Document Services, 7 Eastgate, Leeds LS2 7LY. Email: orderline@cds.co.uk Website: http://www.cds.co.uk Full report also available online at: http://www.dwp.gov.uk/asd/asd5 |
| Keywords | Private pensions ; Conditions of employment ; Contracts. |
| Annotation | The shift away from defined benefit pensions (DB) schemes towards defined contribution (DC) schemes is well known, as is the consequent transfer of pension risks, thought to to be largely with the plan sponsor in the case of DB, and in the case of DC largely with the plan holder or scheme member. Less well-known is that there are a number of other sources of uncertainty in addition to those arising from investment returns and changes in longevity, and that there are many different forms of DB, all with different risk sharing features.A basic assumption of this report is that pensions form a part of the total compensation package that employees receive in exchange for their services to the employer. This report is one of three independent research projects commissioned by the Department for Work and Pensions (DWP) into hybrid or risk sharing pension plans. It presents and theoretical model of risk sharing between firms and employees in pension contracts, with which several common occupational pension designs are analysed. A sensitivity analysis is performed to test how results would change depending on the assumptions used to callibrate the model. The report also notes limitations on the analysis, and notes further work which might be undertaken. (RH) |
| Accession Number | CPA-050906003 B |
| Classmark | JK: WKA: 6QH |
Data © Centre for Policy on Ageing |
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| ...from the Ageinfo database published by Centre for Policy on Ageing. |
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