Competition and Performance in the Polish Second Pillar

This Paper Provides An Assessment Of The Polish Funded Pension System And The Quality Of The Regulatory Framework For The Accumulation Phase. There Are Two Elements That Distinguish The Polish Pension Fund Portfolios From Other Reforming Countries': The Relatively High Component Of Domestic Equity, And The Negligible Component On International Securities. Although This Asset Allocation Has Provided Relatively High Real Rates Of Return In The Past, It May Not Be The Case In The Future, As Further Portfolio Diversification To Other Instruments Will Become Necessary To Ensure Sustainable Rates Of Return. The Paper Provides A Number Of Recommendations To Expand The Opportunities Of Investments To Pension Funds. The Paper Finds That Pension Fund Management Companies Have Been Able To Exploit Scale Economies In Certain Areas Of The Business, Such As Collection Of Revenues, And Proposes To Study Mechanisms To Enhance Them Even More By Centralizing Also The Account Management System, Which May Also Help To Increase Portfolio Efficiency And Competition. The Paper Suggests That, With The Payout Phase Starting In 2009, Broad Definitions In Areas Such As The Role Of The Public And Private Sector Need To Be Established. The Paper Examines The Products And Options That Authorities May Consider For The Design Of The Payout Phase. 1. Introduction -- 2. Overview Of The Polish Pension System -- The Polish Pension System After The 1998 Reform -- Coverage Of The Pension System -- Fiscal Impact Of The Pension Reform -- 3. Structure And Performance Of The Second Pillar -- Structure -- Performance Of The Pension System -- 4. Main Regulatory And Supervisory Issues -- An Overview Of The Regulatory Framework -- An Overview Of The Supervisory Framework -- 5. The Domestic Capital Market -- The Market For Government Debt -- The Equity Market -- Other Fixed Income Instruments -- 6. Recommendations For Improving The Performance Of The Second Pillar -- Recommendations For Improvements In The Accumulation Phase -- Preparing The Regulatory Framework For The Payout Phase -- Developing Financial Instruments For The Two Phases -- App. An Analysis Of Price Competition In The Pension Sector. Heinz Rudolph, Roberto Rocha. Includes Bibliographical References (p. 51-53).