Pension funds should be able to finance UK infrastructure through a bond aimed solely at the industry and offering a yield above the prevailing market rate, Alan Rubenstein has suggested.Speaking in a personal capacity, Rubenstein, chief executive of the Pension Protection Fund (PPF), suggested the pension bond as one way to support the defined benefit (DB) industry in the UK, with assets ringfenced into a sovereign wealth fund.In a debate at the National Association of Pension Funds annual conference in Manchester, former pensions minister Steve Webb urged the industry to focus on the risk-sharing made possible by his defined ambition agenda, while Bill Galvin, chief executive of the Universities Superannuation Scheme, argued it was vital to be honest about the role played by trustees in tackling the DB challenge.Rubenstein argued that the pension bond he proposed dealt with the industry’s hunt for yield but also helped the UK government in its attempts to secure financing for infrastructure projects. “My idea is that these bonds would be long term, say 30 years,” he said.“They might be inflation-linked, or they could be fixed. But, crucially, they would pay a yield that is perhaps 1% above current – instead of 2.5%, in Gilts perhaps 3.5%.”He argued they would only be sold to pension funds, with income ring-fenced to rebuild infrastructure.“Frankly, if we can rebuild our schools, our roads, our hospitals at this kind of rate, we will be getting a good deal,” he said.“If [chancellor of the Exchequer] George Osborne really wants £20bn (€27bn) quickly for infrastructure, this would be the way to do it.”Rubenstein argued that it would help address the problem of pension scheme underfunding and held out the possibility that if deficits improved markedly, it could spell the end of the PPF levy, set at £615m for 2016-17.“I’m asking you to support pension bonds, build a better Britain and save DB pensions,” he said as he concluded his presentation.Webb struck a note of caution, however, questioning whether Rubenstein’s argument that the pension bond was in the interest of inter-generational solidarity rang true.In a good-humoured rebuttal that eventually saw Webb’s call for collective defined contribution voted the best proposal by the audience – 56.6% to Rubenstein’s 43.4% – the former MP noted that the debt incurred through the bond would need to be paid off by future generations, at a higher rate than the UK currently borrows.Webb hypothesised how a conversation on the proposed pension bonds would occur in the Treasury.“I don’t think I could go the chancellor and say ‘You know you can borrow at next to nothing at the moment, do you like to pay more for your borrowing for infrastructure?’” he said.“I don’t think I’d even get through the door. It’s a lovely idea, but it won’t happen.”
Jerusalem: Israel began voting in its second election in five months Tuesday that will decide whether to extend Prime Minister Benjamin Netanyahu’s term as the country’s longest-serving prime minister despite corruption allegations against him. Polls opened at 7:00 am (0400 GMT) and were due to close in most areas at 10:00 pm. At one Jerusalem polling station, a trickle of voters arrived to cast ballots just after opening time. The stakes could not be much higher for the 69-year-old right-wing leader who, as in April polls, faces a strong challenge from ex-military chief Benny Gantz and his centrist Blue and White alliance. Also Read – Saudi Crown Prince ‘snubbed’ Pak PM, recalled jet from US Ex-defence minister Avigdor Lieberman, Netanyahu’s former right-hand man turned rival, could play a kingmaker role with his campaign to “make Israel normal again.” Some 6.4 million people are eligible to cast ballots. The first exit surveys will be released just after polls close, while official results are not expected until Wednesday. Opinion polls have indicated another tight race, showing Netanyahu’s Likud and Blue and White winning around 32 seats each in the 120-seat parliament. Also Read – Record number of 35 candidates in fray for SL Presidential polls Both Netanyahu and Gantz paid a last-minute visit Monday night to Jerusalem’s Western Wall, the holiest site where Jews are allowed to pray. Netanyahu enters the election after having suffered one of the biggest defeats of his political career following the April vote. His Likud along with its right-wing and religious allies won a majority of seats, leading Israeli President Reuven Rivlin to task the premier with forming a new government. But following weeks of discussions, Netanyahu failed, leading him to opt for an unprecedented second election rather than risk having Rivlin choose someone else. The danger for Netanyahu extends beyond remaining prime minister, a post he has held for a total of more than 13 years. If he wins, many believe he will seek to have parliament grant him immunity from prosecution while facing the possibility of a corruption indictment in the weeks ahead. Israel’s attorney general has said he intends to indict Netanyahu for fraud, bribery and breach of trust pending a hearing expected only days after the election in early October. A final decision would come later. Netanyahu would not be required to step down if indicted, only if convicted with all appeals exhausted. Recognising the stakes, Netanyahu spent the final days of the campaign seeking to appeal to right-wing nationalists — key to his re-election bid — and to boost turnout among his base. Those efforts have included a controversial pledge to annex the Jordan Valley in the occupied West Bank, a third of the territory. He has issued unfounded warnings that the vote could be stolen by fraud in Arab communities, leading critics to accuse him of racism. But Netanyahu has also highlighted the country’s growing economy and his relationships with world leaders such as US President Donald Trump. He has tried to label his main opponents “weak” and “leftist” despite their security credentials. “This is the choice that is open to you: their left-wing government or a strong right-wing government led by me,” he said Monday. Gantz has campaigned by presenting himself as an honourable alternative. He has repeatedly spoken of Netanyahu’s willingness to form a coalition with far-right parties that could help him seek immunity. Gantz says his alliance, which includes three former military chiefs of staff, wants a unity government that the vast majority of Israelis would support.