Outcome Focused AssessmentFramework for PensionsWill PriceWorld Bank Pension Core CourseApril 2013
An outcome based assessment aims to start with the ultimateobjectives we want to achieve and then set out the reformsmost ...
The reviews are driven by what works to improve outcomes– the evidence comes from a wide range of sources3EfficiencySustai...
Each review should focus on the core issues that driveoutcomes. Reviews can scale to the time available4•e.g. Scale•Long t...
The completed Outcomes Focused Assessment Frameworkcan then be used as an integrated grid.5Efficiency Sustain-abilitySecur...
The grid gives an example of how the country features and ultimate outcomescan be reviewed in a joined-up way. If a review...
Conclusions• An Outcome Based Assessment is a tool to ensure the current state and futurevision are clearly identified to ...
Will Pricewillprice@worldbank.orgwww.worldbank.org/nbfi/pensionfunds8
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Pensions Core Course 2013: Outcome Focused Assessment Framework for Pensions

Published on: Mar 4, 2016
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Transcripts - Pensions Core Course 2013: Outcome Focused Assessment Framework for Pensions

  • 1. Outcome Focused AssessmentFramework for PensionsWill PriceWorld Bank Pension Core CourseApril 2013
  • 2. An outcome based assessment aims to start with the ultimateobjectives we want to achieve and then set out the reformsmost likely to achieve those objectives.2Economic and politicalEnvironmentOverall Framework –other pillars and key rulesSupervisionMarket Structure, Entitiesand ConductEfficiencySustainabilitySecurityCoverageAdequacyPension System Features Ultimate Outcomes
  • 3. The reviews are driven by what works to improve outcomes– the evidence comes from a wide range of sources3EfficiencySustainabilitySecurityCoverageAdequacyStandardsWorking papers/casestudiesGlobal and regional bestpractice (World Bank,OECD, IMF, EU etc.)Academic and privatesector research
  • 4. Each review should focus on the core issues that driveoutcomes. Reviews can scale to the time available4•e.g. Scale•Long term investment strategy•Cost control and transparencyEfficiency• e.g. Liability risk management• Automatic adjustment mechanisms• DB recovery plans supervisedSustainability• e.g. Income till death• Internal Controls• Objectives of Supervisors (and other IOPS standards)Security• e.g. Rules on participation• Labor market informality• Reach of market providersCoverage• e.g. Level of contributions• Enforcing contributions• Exit and withdrawalsAdequacyImpacts/UltimateOutcomesKey features driving outcomes(full list of features available on request)
  • 5. The completed Outcomes Focused Assessment Frameworkcan then be used as an integrated grid.5Efficiency Sustain-abilitySecurity Coverage AdequacyEnvironmentFrameworkMarketsSupervisionIn a strategic reform all elements may be in play. For specific reviews onlysupervision, or only efficiency may be under review.
  • 6. The grid gives an example of how the country features and ultimate outcomescan be reviewed in a joined-up way. If a review is very targeted e.g. onlysupervision the grid also shows which elements are outside the control of thesupervisor6Ultimate OutcomesSystem FeatureEfficiency Sustainability Security Coverage AdequacyCountry andFinancial SystemEnvironmente.g. politicaldirection ofinvestmentallocatione.g. govt.contribution debtor tax financede.g. politicalconsensus forpension systeme.g. level andtrends in labormarket informalitye.g. wage &employment growthFramework andRegulatione.g. controls onfees, defaultinvestment fund(inc rules on investdomestic v foreign)e.g. autoadjustingretirement agee.g. rules forannuity v lump sume.g. auto-enrolment to‘nudge’ increasedcoverage, ormandatorye.g. size of otherpillars & level ofcontributionMarket Structure andConducte.g. strength ofdemand side +scale providerse.g. quality longterm governanceincludingdisclosuree.g. publicdisclosure andquality internalcontrolse.g. whether firmsprovide accountsto small/medcustomerse.g. ‘churning’ ofcustomers accountsSupervision e.g. focus oninvestmentgovernancee.g. risk basedcontrols onsolvencye.g. fit and properand ultimatebeneficiary checkse.g. checkemployers enrolstaffe.g. checks on recordkeeping and paymentof contributionsMatching key features of a pension system to their impact on outcomes
  • 7. Conclusions• An Outcome Based Assessment is a tool to ensure the current state and futurevision are clearly identified to aid reform programs• Can be used to set out design of a new system or assess an existing one• Approach for private pensions and public pensions share a common core.• Integrated or multi-pillar reviews a powerful approach• Outcome Based Assessment can also be carried out on one part of a system, orfor one outcome.• OECD/IOPS standards part of assessment framework• Funding likely to be available to pay for a review – expressions of interestwelcome7
  • 8. Will Pricewillprice@worldbank.orgwww.worldbank.org/nbfi/pensionfunds8

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