LETTER: Why not let people withdraw a part of pension savings in times of need?
Without regulations prescribing how pension fund assets are to be invested, pension funds have no reason to change their investment allocation from the current equilibrium
Much has been written about pension savings being used to fund domestic investment. Pension fund trustees are currently able to invest in infrastructure projects, and they do. Without regulations prescribing how pension fund assets are to be invested, pension funds have no reason to change their investment allocation from the current equilibrium.
The request for pension funds to stimulate the economy through investment in infrastructure may have been aimed at the Government Employees Pension Fund (GEPF) trustees and the Public Investment Corporation (PIC). The economic and financial laws of risk and return apply to them as well: suboptimal investment allocation will eventually harm public sector workers, or taxpayers — those asked to pick up the shortfall...
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