Improving pensions

Policies and regulations can increase the returns on pension funds; these can reduce the politics over the issue

The debate over the Old Pension Scheme (OPS) and the National Pension System (NPS) in India usually centres around distribution. Who should contribute how much to the investments? And, who should bear the risks? The risks are usually considered exogenous but this is questionable. Even the expected return rates are not exogenous. 

Returns on investment constitute the bulk of the accumulated amount at the time of retirement; the investment itself, though pivotal, is relatively small at that stage. This is because for pension funds, the investment horizon is very long and the compound interest is powerful. It is important then to