DB ‘can still play a role for years to come’ despite rise of DC

first_imgSibylle Kampschulte, senior international consultant at Willis Towers Watson in Vienna, said DB benefits would be used “selectively” by employers to position themselves to attract workers.However, Ziegelbecker added: “Employees often are not aware of the contributions employers are making to DB plans as only the future pension payout is seen. In defined contribution [DC] plans, the level of contributions is more visible.”In the German civil servant segment it is exactly this future pension promise which people expect, explained Hagen Hügelschäffer, managing director at the German AKA, the association for supplementary pension systems in the municipal and church sector.“We are facing a major retirement boom in the public sector and with it a severe shortage of skilled workers,” he said. “As the salary level in the public sector will never be very high, a DB pension promise can be the ‘goody’ to get skilled workers.”According to the latest collective bargaining agreements, supplementary pensions in the public sector in Germany have to guarantee 3.25% interest during the active phase and 5.25% plus an additional 1% “dynamisation” during the retirement phase.Hügelschäffer added it would be “impossible to introduce DC to the German public sector”.The high costs of public sector pensions in Germany were recently found by the think tank ESISC to be one of the major weaknesses of the system. In a briefing, the authors proposed to “erase the privileges of the civil servants”.A Dutch exampleOn the panel at the summit in Vienna, Sibylle Reichert, representative of the Dutch pension federation in Brussels, reported on the current debate on a transition to a hybrid pension system.“The Netherlands is currently moving towards an ‘individual collective DC’ with higher transparency and more security in the pay-out phase,” she said.She added the long-awaited proposal should be presented “before summer”, by the not-yet-formed new government. Coalition talks are continuing after the general elections in March. However, the transition phase from the current DB to the new hybrid system “will take 20 to 30 years,” Reichert said.“We should end the system debates of DB versus DC as people are only interested in what they can expect in the end,” she said.But she added: “It has to be a hybrid system because it is an illusion to make promises when we have no idea what happens in 40 years.”DB’s power remainsHügelschäffer presented some statistics on the major weight old DB promises still carry in European pensions: “57% of all pension assets in Europe are still in DB systems, while only 9% are pure DC and 34% in hybrid systems. However, looking at occupational pension plans, it shows that only a minority is still DB.”Overall, the delegates at the conference believed the future lay in DC or hybrid pensions with collective risk taking. In addition, they agreed that communication with members was vital to the success of DC and hybrid plans. Despite a clear trend to the contrary, defined benefit (DB) pension plans will still have a role to play even in 30 to 40 years, German and Austrian pension experts have said.This was the consensus among delegates at a panel discussion during the Institutional Retirement and Investor Summit in Vienna this week.Johannes Ziegelbecker, board member at the €700m Austrian Bundespensionskasse for federal employees, said: “I do not think there will be any new DB plans set up within the Pensionskassen but employers will still be using DB in direct pension promises to employees in higher positions.”Therefore defined benefit obligations might still be added to Austrian companies’ balance sheets decades from now, he said.last_img read more

Trip to UND features familiar faces

first_imgUW forward Brianna Decker is familiar with North Dakota\’s talented Lamoreaux sisters, having played at Shattuck St. Mary\’s with the two.[/media-credit]The Badgers are not the only team with two returning Olympians who have turned their teams around. Surprised?After its second loss of the season, the Wisconsin women’s hockey team heads on the road to face a revamped North Dakota squad.Suffering their first loss at home to Minnesota-Duluth, Wisconsin has to regroup as it faces a North Dakota team that, previously not the strongest WCHA squad, welcomed sisters Jocelyne Lamoureux and Monique Lamoureux-Kolls, who turned the Sioux into a third place team.Knowing they are a tough team, the Badgers know they will have to keep their eyes on the Lamoureuxs.Head coach Mark Johnson coached the Lamoureuxs last year as part of the Olympic team.“They have great stick skills, can beat you one-on-one, and have the ability to get the puck in the net with great shots and scoring ability,” Johnson said. “Whether you’re playing defense or you’re one of the forwards on the ice, if you get in a battle with them you have to be prepared to make sure you don’t get beaten. Easier said than done. They’re very strong on their skates, they’re very strong physically.”Johnson is not the only one with some experience with the Lamoureuxs. Sophomore forward Brianna Decker skated with the sisters in high school.“I played with them for three years at Shattuck, so I kind of know how they play,” Decker said. “We know that they are their two main players and strength to their team. We’re just going to have to come out as a whole. I think our team as a whole should be able to handle them. They’re great players, so we’ll just have to prepare for their skills.”Despite being fresh off a loss and about to hit the road, the Badgers are confident they will be able to turn things around.UW feels it did not play its best last weekend, and the Badgers are hoping to make up for it.“It’s away, so the home team will have the advantage with the line changes and stuff like that, but hopefully we’ll be able to bounce back and maybe get some revenge for last weekend,” Decker said. “We know we didn’t play our best on Sunday so hopefully we’ll be able to come back against North Dakota with that power and strength we have on our team.”One thing the Badgers are focusing on is being more consistent. Wisconsin has had a strong season thus far, but last weekend, after a strong win on Friday, it looked very different on Sunday, scoring in the first minute only.Sophomore defender Saige Pacholok noted UW’s need to cut down on mistakes and continue to play confidently.“Consistency is key,” Pacholok said. “We’re not all going to have perfect games. Like Coach said, you can’t go a game without making mistakes, but we have to limit them as much as possible. Play confident, play as a team; communication is a big thing I think.”Even though it did not have quite the success it wanted last weekend, Wisconsin feels Minnesota-Duluth was a good way to prepare for North Dakota.With a strong offensive attack in the Lamoureaux sisters and the confidence a winning season has given the rest of the Fighting Souix squad, the Badgers know a tough fight is in store.“Us defensemen, especially, have been working on passing the puck quick, tape-to-tape passes; I think that’s key,” Pacholok said. “Moving the puck, let the puck do the work for us, I think it’ll be really handy for us this weekend.”last_img read more