Management and Regulation of Pension Schemes: Australia a Cautionary Tale, 1st Edition (Hardback) book cover

Management and Regulation of Pension Schemes

Australia a Cautionary Tale, 1st Edition

By Nicholas Morris

Routledge

200 pages | 5 B/W Illus.

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Hardback: 9781138287792
pub: 2018-03-29
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Description

Perhaps the greatest long-term challenge facing modern economies is how to pay for the living expenses and care costs of the elderly. Following policy decisions made in Australia in the 1990s, a substantial part of the pension requirements of the next cohort of retirees will be met from savings accumulated during working years. The effective management of these savings is crucial. If they are invested wisely, the assets available to fund pensions and care will grow; if not, available funds may turn out to be insufficient. Unfortunately, there is considerable evidence worldwide that the management of funds attracts rent-seeking behaviour by the financial services industry which erodes much of the potential return.

Australia introduced compulsory superannuation contributions for its working population in 1991, leading to a proliferation of funded schemes that are largely run by the private sector. Complexity, and many degrees of separation between fund members and those who manage their funds, have emerged as serious problems. Combined with weak competitive pressures and governance systems, and insufficient legal and regulatory constraints, the result is a system that does not serve its members well.

This book provides a detailed evaluation of the Australian experience, highlights the extent to which the financial services industry has extracted rents from Australian pensioners, and how and why this occurred. Based on original empirical research, and examination of industry reviews and relevant literature, the book demonstrates the numerous principal–agent, conflict of interest and rent extraction problems that have emerged in Australia. The book makes suggestions for how these problems can be addressed in Australia, and also provides lessons for other countries wishing to enact pension reform.

Table of Contents

Chapter 1: Introduction

Chapter 2: System Design and Problems

Chapter 3: The Evolution of the Australian Pension System

Chapter 4: Empirical evidence on costs and performance

Chapter 5: Lessons from Australia

Chapter 6: What can be done now

Chapter 7: Conclusions

About the Author

Dr. Nicholas Morris is an adjunct professor in the law faculties of UNSW, Sydney, and Latrobe, Melbourne; a visiting fellow at the Martin School, Oxford; and a guest professor at the China Executive Leadership Academy, Pudong, China. He has been Deputy Director of the UK Institute for Fiscal Studies; Chief Executive and Chairman of various economic consultancies including London Economics; a visiting fellow at Balliol and St Anthony’s Colleges in Oxford, and at Melbourne University; and has led numerous projects in developing countries.

About the Series

Routledge Research in Finance and Banking Law

This series explores the key developments in financial and banking law, offering critical analyses of legislation and regulatory frameworks at the international regional and domestic levels. Legislation, case law, regulatory structures and institutions are discussed from a variety of theoretical and methodological approaches. The books in this series provide valuable and far-reaching investigations into the challenges of regulating finance and banking in a fast-moving and interconnected global economy.

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Subject Categories

BISAC Subject Codes/Headings:
LAW009000
LAW / Business & Financial
LAW115000
LAW / Pension Law