The Expert Panel's Report on Government Employee Pension Reform

In Japan legislation was passed to integrate government employee pensions with the public pension scheme for private employees. As part of the integration process, it was decided to abolish the “occupational” portion of public employee pensions, which is equivalent to a corporate pension. An expert panel to discuss a follow-on system was established, and it published a report in July 2012 recommending a pension modeled after the cash balance plan in the private sector. We found some of the remarks on DC plans in the report worth further discussion. There are advantages and disadvantages to both DB and DC plans, and one is not necessarily clearly better than the other. We think it important for the debate over reforming Japan's government employee pensions to move forward based on a wide range of perspectives