Why government paper is preferred asset class for pension funds

Retirements Benefits Authority wants pension funds for public entities not to be categorised as public funds. [Courtesy]

An ageing workforce in the public sector has been cited as one of the key reasons why investment firms concentrate their assets under management in government paper, even as the regulator is pushing for diversification.

According to the Retirements Benefits Authority (RBA), Treasury bills or T-bills and bonds are among the top five preferred asset classes for investment firms, yet the regulator has a broad list of 15.