David Bogataj

The extended MRP model for the evaluation and financing of superannuation schemes in a supply chain

AbstractThe retirement age of industrial workers in national pension schemes is being raised. However, many industrial workers are not able to work until they have reached the increased retirement age. This problem is decreasing social security, increasing workers anxiety regarding the future and influencing the quality and timing of production processes. Disruptions and lower quality items produced in one activity cell of a supply chain can have a ripple effect throughout an entire supply chain. To solve this problem, we should put in place supplementary occupational pension schemes, which would compensate firms for the depreciated ability of their elderly workers to work when they have reached the previous retirement age but have not yet reached the new, higher retirement age. This article is introduces a model that is based on extended MRP Theory. The model can be used as a basis for negotiations between employers and employees to keep production at the same level of quality. The trade-off between high...

Financing Urban Growth in Aging Societies: Modelling the Equity Release Schemes in the Welfare Mix for Older Persons

The paper examines the role of Equity Release Schemes (ERS) in the welfare mix for seniors. The concepts for asset-based welfare, where the housing owned by the occupant is part of his portfolio comprised of defined contribution (private) pension and residential property, are examined. We present how the variance of expected senior’s income is reduced by using residential property as the pillar of the pension system, as proposed in the EC Green Paper on Pensions (2010). The study is focusing on modelling the decumulation of the housing equity and the defined contribution private pension, incorporating insurance mechanisms for management of longevity. Development of longevity insurance in the framework of reverse mortgage products is important in European Union due to lack of government insurance of reverse mortgage products as developed in United States under the HECM insurance program. Here we propose a new model in which periodic payout that the beneficiary receives is the difference between the amount drawn and the annuity premium for longevity insurance. The paper shows how the drawing amount in the loan model ERS (reverse mortgage) is decreasing with the increasing interest rate, while the pension arising from defined contribution systems is increasing with the increasing interest rate. The optimal combination of sources in the portfolio which minimize volatility induced by volatile interest rate is derived and discussed. The paper intend to show that regarding his/her old-age welfare protection, young person when employed should consider buying a home instead of rent, to gain the optimal structure of pension portfolio in retirement.

Sustainable Urban Growth in Ageing Regions: Delivering a Value to the Community

Europe is wealthy but unbalanced, and the flows of people, money, information, goods and services are suffering from this situation. There is a crucial question in today’s European economy: “How to balance the European wealth and facilitate the flows to achieve wellbeing for all generations (job opportunities for the young and proper care for seniors)”. The answer is in Smart Silver Economy, by developing a firm understanding of space of flows and space of places as considered by Castells. The idea is to develop the knowledge to embed it in SUGAR ICT toolkit, based on SUGAR technology platform (SUGAR TP), which would facilitate understanding to increase intensity of processes. It is the ambition of SUGAR to establish roadmaps for action at EU, national and international level, bringing together scientific knowledge, art (architecture), technological know-how (GIS, ICT), industry (health care, real estate and facility management, ICT development companies), regulators (banks, insurance, health, municipalities and regional spatial planning authorities), and financial institutions to develop a strategic agenda for leading technologies for smart urban growth in face of an ageing society. The core of this idea is presented in article here.

Reverse Mortgage Schemes Financing Urban Dynamics Using the Multiple Decrement Approach

The objective of this chapter is to introduce flexible reverse mortgage contracts and to consider them in a multiple decrement model. Here, the multiple decrement approach is applied for the first time in housing and urban planning as a new tool for better forecasting of the housing market and housing needs of senior citizens with decreasing functional capacities and therefore changing housing needs on their lifetime horizon. The presented approach enables development of appropriate, more flexible equity release schemes (ERS) than the products known up to now. In the flexible reverse mortgage model developed here we assume that the homeowner can always sell her/his residential property and buy the new residential property for the amount which is of the same value as that of the first house, or lower. It enables better management of cash flows related to the portfolio of residential properties in the context of ERS—the reverse mortgage approach. The schemes are designed to allow elderly homeowners to convert the equity in their homes to income and to keep the possibility to sell their property and move to a more appropriate dwelling under the same contract, which was not the case up to now. Namely, in these newly presented ERS products, homeowners can also keep the mathematical reserves for longevity insurance, based on the initial contract, when they move and sell the initial residential property and buy a new one. They also keep their deferred lifetime annuities if they finally sell the residential property and move to long-term care in a retirement home. In this new approach, the reverse mortgage schemes/longevity insurance are not tied to the single property as it is the case in the existing reverse mortgage products, but rather to the life of the senior homeowner. In the numerical examples, different cash flows associated with different paths of a graph are presented demonstrating the advantages of the flexible reverse mortgage. We show that not only the transaction costs are lower but also that the set of possible choices is larger. According to population aging in Europe, where in 2060 one-third of the population will be more than 64 years old, it is important also for the local authorities and spatial planners to study elderly people’s housing needs in order to design a housing system suitable also for them, and therefore to adopt the housing stock to the desired housing consumption. The housing needs of senior citizens may be satisfied if the housing stock is specifically designed to meet their physical, emotional, recreational, medical, and social needs. Recognizing that urban space must be adapted to meet these objectives, the paper will examine the issues regarding the sustainable financing of senior citizens and their changing housing needs in particular.