News in brief: 19 March

- Estonian citizens are “seizing the opportunity of the pension reform” to allow them to withdraw savings from the second pillar pension system, according to the Estonian Pension Centre.

Its analysis shows that as of 18 March, 121, 663 people have applied to exit the second pillar of the Estonian pension system, equivalent to 15.8 per cent of current members. The reform was highly controversial with President Kersti Kaljulaid stepping in to try block it but the Supreme Court eventually ruled in favour of the reform, which was introduced on 1 January.

- The UK’s Pensions Administration Standards Association (Pasa) has announced LexisNexis® Risk Solutions UK & Ireland, as its expert partner for member identity management.

Commenting, Pasa director, Girish Menezes, said: “Member-centric pensions administration is only possible with a clear view of member identity – understanding who they are, where they live and important details of their situation, enables pension schemes and administrators to meet their fiduciary requirements, prevent fraud, manage longevity exposure and put members firmly at the heart of everything we do. Partnering with LexisNexis Risk Solutions will enable us to achieve this in the UK through expert support and sharing best practice with our members to help them better understand their members and tackle fraud, which unfortunately is more prevalent now than ever before.”

- Higher birth rates are needed in Finland to, among other things, ease the pressure to raise earnings-related pension contributions in the future, according to research by the Finnish Centre for Pensions (ETK).

Population Research Institute di¬rec¬tor of re¬search Venla Berg said that the decli¬ne in the Fin¬nish birth rate is main¬ly due to three things: people ha¬ving children at an inc¬rea-singly older age, people ha¬ving only one or two children, and an inc¬rea¬sing num¬ber of people wan¬ting to be child¬less. Im¬pro¬ving the birth rate in Fin¬land requi¬res chan¬ges in wor¬king life and more child- and fa¬mi¬ly-friend¬ly public po¬licies. The un¬fa¬vou¬rable de-mo¬grap¬hic de¬ve¬lop¬ment also af¬fects the pen¬sion sys¬tem, the research found. There is no im¬mi¬nent pres¬su¬re to raise pen¬sion cont¬ri¬bu¬tions, but in the long run, low birth rates strain pen¬sion fi¬nancing as the wor¬king age po¬pu¬la¬tion con¬ti¬nues to sh¬rink in num¬ber, according to ETK de¬ve¬lop¬ment ma¬na¬ger Heik¬ki Ti¬kan¬mä¬ki.

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