3,423 research outputs found

    Is there a pensions crisis in the UK?

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    The UK pension system is traditionally seen as offering a good example to other countries, having features such as a low social security burden of the public sector as well as a high coverage of well-financed voluntary private schemes. But recent developments suggest that the model has shown weaknesses. The most pressing current issue is underfunding of defined benefit occupational schemes following the bear market; but there are also the ongoing crises of mis-selling of personal pensions and the failure of Equitable Life insurance company. In this paper we seek to investigate whether there is indeed a crisis and what the locus of the true crisis is. We find that there are important longer-term weaknesses of the UK system as well as these current difficulties, focusing on social security as well as private pensions. Pitfalls faced by UK policymakers offer important lessons to other countries seeking to set up or expand private pension provision

    Towards a typology for systemic financial instability

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    This article seeks to provide a categorisation of events of systemic financial instability that have been experienced in recent decades, seeking to draw out common elements from these seemingly-diverse events. We maintain that despite the apparent diversity of events of financial instability, a useful summary categorisation is between bank, market-price and market-liquidity based crises. There are important subcategories of each type, such as domestic versus international, currency crisis linked, single-institution based, equity-related, property, commodities, deregulation and disintermediation linked crises. Such financial crises are usefully examined in the light of the theories of financial instability, not least to illuminate common generic patterns that can be helpful in macroprudential surveillance. We derive a framework for analysing the evolution of such crises, highlighting that it is vulnerability of a financial system that is the key common element to a crisis, besides the nature of propagation of a crisis to the wider economy. Besides having general applicability, notably to OECD countries, the typology and generic features have some relevant implications for euro area countries. Development of securities markets, the likelihood of regional crises and the likely impact of ageing are among aspects that warrant vigilance by policy makers in the euro zone