Role Of Pension Regulator

In developed financial and capital markets all financial intermediaries such as banks, insurance companies, and pension funds are well regulated. India is the first country in Asia to establish an independent regulator for the pensions sector. The regulator is expected to do much to integrate the disparate components of the social security system into a fiscally, financially and economically sustainable multi-tier system. If PFRDA were to bring in international best practices into pension management, it would lead to greater financial innovation and deepen the capital market. PFRDA should maintain an ongoing dialogue with academics, professional organizations, and industry experts, in order to evaluate pension reforms worldwide and build a holistic perspective on tackling the challenges of an ageing population. Once the sector is developing in the right direction, its overall regulation may be handed over to a super regulator. All this requires a significantly enhanced understanding of social security economics and issues and broader policy issues on the part of all stake holders, particularly the policy makers.