Japan is planning to use its pension assets to pay for its huge public debt, which violates UN rules of accounting for public pension liabilities. The UN setting such rules is to provide social security for the general working class. If the pension assets are used for other purposes, the pension system will become more struggling to provide previously expected pensions for the elder population in the society and the social inequality will be worsened and the current working class will feel unsecured. These are the social impacts.
Using some pension assets for other purposes could damage the government's credibility and people will spend more on their pension plans and use more private pension schemes and services. Therefore, the insurance companies and other private pension scheme providers could benefit when the government becomes untrustworthy. The government could use the assets to flatter its balance sheet; therefore, the bond yield may fall as the government controls more assets and the probability of default decreases. Moreover, the government may be able to use the extra resources to provide future economic performance improvement, hopefully it can bring more government incomes in the future due to the future higher economic growth rates and use the extra incomes to compensate the pension assets used today.
I do not think that Japan can use the extra assets to generate high economic growth in the future, as the Japanese government and central bank have used many stimulus policies and still are unable to increase the domestic inflation rate and generate better economic performance. Moreover, the pension system has become fragile in a global scale that many countries may fail to pay out pensions to their populations in the near future. Therefore, instead of using pension assets for other purposes, it is even possible for some countries to use their government budgets to fill out the shortages in their pension systems in order to provide social securities and equality.
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