DEFINITION of Government Actuary
A Government Actuary is an employee of the U.K. government who works for the Government Actuary's Department (GAD). The GAD provides actuarial consulting services for the public sector at a set fee structure. It provides consulting on numerous actuarial and statistical topics including: pensions policy and regulation, occupational pensions, staff transfers, social security, insurance, healthcare financing and actuarial training.
BREAKING DOWN Government Actuary
The first government actuary was appointed in 1917, and was shortly followed by the British finance ministry creating the actual Government Actuary Department. The government actuary first provided financial implication reports to Parliament on health insurance proposals and unemployment-related legislation. The government actuary's role expanded significantly since World War II and today it advises public sector clients from the U.K. and worldwide.
What The Department Does
An actuary is a professional who assesses and manages the risks of financial investments, insurance policies and other potentially risky ventures. Most actuaries work at insurance companies, where their risk-management capabilities are particularly applicable.
Actuaries assess the financial risk of a particular situation, primarily using probability, financial theory and computer science. The convergence of these fields for the actuary profession is called actuarial science. Public and private institutions rely heavily on actuarial science to determine the relative risk of various decisions; as such, actuaries are trained and tested extensively before they are allowed to practice. Investment banks and insurance companies employ a number of full-time actuaries, but other actuaries, either self-employed or working as a part of an actuarial firm, act as consultants for a number of different types of businesses
"Actuaries have analytical skills that help decision-makers take account of risk and uncertainty. At the Government Actuary’s Department (GAD) our mission is to support effective decision-making and robust reporting within government as the first choice provider of actuarial and specialist analysis, advice and assurance," the Government Actuary's Department states on its website.
The U.K. Government Actuary's Department is a non-ministerial government department providing actuarial services to a wide range of other government departments. As of 2018, it had some 160 staff, with over 100 being qualified or trainee actuaries. The department provides client/advisor relationships, secondments, onsite actuaries for various departments and projects, project board membership and project work with professional financial risk and modeling expertise.
Their main task is advising on complex situations concerning long term risk and uncertainty including pension scheme actuarial valuations, insurance reserving and pricing, quality assurance of financial models, advice on policy development, ad hoc modeling and peer review.