The Discount Process Is The Problem!

Capitalisation leads to "fake news" (it hides too much). Simple and simplistic, discount rates are dangerous in everybody's hands. For long-term projects with specified intended outcomes, actuaries should stop using discount rates alone because cashflows are the key elements. If we can't do simple (discussed in presentation), can we really do complex?


After 4 years with Duncan C Fraser and 12 years with Clay & Partners, Jon Spain spent 28 years at GAD. His whole career was spent in DB pensions, previously advising a range of private sector trustees and sponsors on scheme funding and M&A. At GAD, he acted for a wide range of public sector pension clients with diverse problems. Apart from gaining his FIA in 1977, he qualified as a Fellow of the Chartered Institute of Arbitrators in 1997. No longer acting for clients, he is continuing personal research, focussing upon long-term budgeting. Since the late 1990s, he has volunteered for IFoA, being a member of the “Pension Fund Valuations And Market Values” working party (paper presented 25 October 1999) and of the follow-up working party set up in 2003 but discontinued in 2004. Formerly on Pensions CPD Committee, he was a member of the “Risk Measures” working party (paper presented 18 March 2019), Funeral Plans MIG and SIAS Committee and he has spoken at conferences. As far back as 1983, he had been working independently, trying to bring “long-term” back to UK actuarial thinking, currently focussing upon discount rates (

Tuesday, 01 March 2022

15:00 - 15:45 GMT


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    Jon Spain
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    Professor Michael Mainelli
    Executive Chairman
    Z/Yen Group