Public pension plans

In its April Notes, the Employee Benefit Research Institute (EBRI) covered public pension plan asset allocations.

This analysis examines the volatility in employer contribution rates caused by the higher-return-seeking/higher-risk investment portfolios adopted by many pension plans, and whether plan sponsors will increase fixed-income investments in order to reduce volatility. It appears that, in the short run, a significant shift toward a lower-return investment policy in return for reduced volatility in employer contributions is unlikely to occur because of plan sponsors’ expected high returns from current asset allocations, their current ability to use high discount rates, and the tendency of investment managers to not deviate from peer group investments.

Public Pension Plan Asset Allocations
      Report (pdf, 12pp/328kB), April 2009
      Executive Summary
      Press release