Rules on Japan’s new 401(k)-type pension scheme that would ban companies from promoting their own shares and bonds in order to push up prices have been drawn up by the country’s labor ministry, Reuters reports.
The news service quoted the Nihon Keizai Shimbun, a Japanese business daily, as saying that the rules are aimed at protecting workers’ right to choose assets for their pension portfolios and barring managers from using the new pension vehicles to boost asset prices. The new system is slated to be launched in October.
Japan currently operates under a defined-benefit pension system that promises set returns and entrusts all funds to financial institutions, Reuters notes.
Japan must reform its pension system because its post-retirement-age population will become the biggest in the industrialised world in about 30 years, according to the news service.