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Letter from Brussels: A vision for cross-border workers

A former director of the European Association of Paritarian Institutions (AEIP) has proposed a new option for occupational pensions that could help the large number of workers whose careers take them across EU internal borders.

Francesco Briganti has suggested in a doctoral thesis that a cross-border facility should be added to existing choices for schemes which, at present, relate to about 30 different national sectors of workers. They serve specific fields of employment where the movement of employees across EU borders is common.

The outcome could be a fourth option for occupational and private pensions schemes in existence or under consideration. Apart from the conventional, existing IORPs, the option would add to the Resaver retirement savings vehicle for academic researchers expected to start this autumn. It would also be in parallel with the Pan-European Personal Pension (PEPP) project.

Briganti’s work at the AEIP involved the negotiation with and alignment of the EU institutions in relation to cross-border and national employee benefits plans. It covered areas such as retirement, healthcare, disability, unemployment, health and safety at work and paid holidays.

This concept would involve development from existing foundations. These comprise the basic set-up of European social partners for sectors such as construction, medicine, IT, academia, agriculture, transport and others. The number of individuals to which the the scheme could apply runs into the millions.

Briganti says there are already Brussels offices for all of the different sectors’ social partners. For each there are two bodies, representing employers and employees, which meet in EU-recognised Sectoral Social Dialogue Committees.

In many EU member states there are country-wide agreements to manage the appropriate pension funds. Hence, states Briganti, there is already a foundation on which to base the cross-border function.

As for the legislative background, his research shows that, at present, his plan would be consistent with the relevant European Treaty rules. Nevertheless, appropriate EU directives could help to remove obstacles.

He says he is aware of potential opposition from several national governments. They would wish to protect their influence over pension methodology. Further opposition is envisaged from the social partners – that is, the trade unions and employer federations, both of which operate at national level. The problem here, says Briganti, is how to face the question of “power and influence” any nationally based social partners could lose.

Hence, the challenge involved in achieving Briganti’s dream of a pan-European occupational plan through social dialogue is to persuade the social partners to see the benefits of amalgamating existing national set-ups for different sectors of workers into schemes functioning across borders.

If successful, one important pay-off would be the huge improvement in economies of scale in combining the funds involved. Achieving such fusion would result in a significant reduction in administrative costs. As a result, this would be of benefit to employers, including multinational corporations.

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