The founding text of the European project is the Treaty of Rome, which was signed almost 50 years ago, on March 25 1957. Since then much has been done to create the single economic community with an internal market. But it’s also important to remember that the Treaty also emphasises the social aspects of the union.
Article 2 states that the Community’s task shall be to promote “a harmonious and balanced development of economic activities, sustainable and non-inflationary growth respecting the environment, a high degree of convergence of economic performance, a high level of employment and of social protection, the raising of the standard of living and quality of life, and economic and social cohesion and solidarity among Member States”.
So it’s interesting to note that despite the undoubted, though not always smooth, progress in the creation of the European single market, social protection systems were not included in discussions between heads of state and governments until as late as the Lisbon summit in 2000.
That there’s a gap between social protection and financial markets thinking is exemplified by the fact that the occupational pension fund directive, an Internal Market proposal, contains no mention of social or labour law. Then there’s the current wrangling over the proposed pensions portability directive, an Employment and Social Affairs plan.
One of the bodies actively involved in trying to bridge this divide is the AEIP, the European Association of Paritarian Institutions of Social Protection. The AEIP is now 10 years old and celebrated its anniversary at a gathering in Brussels in September. It’s been called a “laboratory of ideas”.
The AEIP has five areas of interest: coordinated retirement schemes, pension funds, sickness insurance and providence, paid holiday schemes and territorial social protection schemes. It has grown to encompass 11 associate members, six observers and eight correspondents through 16 EU states and Switzerland.
The AEIP grew out of alliances between the French Technical Centre of Provident Institutions (CTIP), the German Federation of corporate sickness funds (BKK-Bundesverband), Italian pension fund association Assoprevidenza and Belgian pension insurance fund Integrale. The association aim is to show the way forward for the coordination of social protection - not the harmonistion.
“As the goal of harmonisation was abandoned a long time ago, we need to move towards the convergence of all systems with a guaranteed minimum assistance for everyone,” says AEIP President Bernard Davy, who is also President of the management board of France’s ARRCO.
“As for AEIP, its mission is to communicate both management and labour initiatives, make sure that these are shared and ensure that progress is made in terms of analysis and debate within the European institutions.
“It also exists to promote the recognition of paritarian social protection at the European level, which will certainly be a future source of solidarity and progress in defining social Europe.”
“For us, AEIP is a laboratory of ideas and analysis, the purpose of which is to work together to find the best formulas for European cooperation,” says Jacques Brossard, vice president of Lombard Odier Darier Hentsch in Switzerland.
The AEIP maintains that an identical level of social protection for all workers in a company or industry “promotes worker mobility at European level, thereby improving the competitiveness of companies and broadening the labour market’s potential”. Despite the different systems in member states, the AIEP points out the constant value of solidarity. “We have noted that it has been through collective negotiation that the value of solidarity - shared by all European legal systems and involving employers and employees in the implementation of a common project - has been implemented.”
“As a result the AEIP is convinced that the paritarian institution model is the right model for building these complementary, effective and genuinely solidarity-based social protection systems at the European level.”
It’s the association’s belief that there is a need to establish a complementary European protection law centred around the specific recognition of the ‘European Paritarian Institution’.
This is defined as a “a management entity tailored at the European level for supplementary social protection and ensuring equal representativeness of all employers (companies or subsidiaries) and their employees who benefit from it, regardless of the territorial scope of the agreements.”
The AEIP stresses that this does not mean one legislation for all EU member states. “Instead, it means defining general common rules that coordinate member systems.”
The group offers a comprehensive federal cooperation model that covers all the aspects of social protection, in addition to what is compulsory in each country.
Paritarianism has existed for more than a century in German, the AEIP explains, adding that the concept has been developing steadily in France since 1937. The tradition is also strong in Italy, Belgium the Netherlands and Luxembourg. It’s also strong in the Scandinavian countries and, despite what many think, can also exist in the UK and Ireland. It’s highly developed in Switzerland and Austria and nascent in the new eastern European member states.
“European recognition of the paritarian institution would be undeniable progress for an enlarged Europe in which there are still to many barriers in terms of the social protection of employees,” says secretary General Bruno Gabellieri.
Paritarian ideas for the future include the four-pillar solution developed in Finland or the regional pension funds such as those pioneered by Pensplan in the Trentino-Alo-Adige/Sud Tirol.
The AEIP has asked the Catholic University of Leuven to study the coherent transposition of the pension fund directive covering six member states.
“It is necessary to avoid any risk of legislative dumping in this area, because the directive does not give any definition of industrial relations or labour law,” the AEIP says. CEIOPS, the Committee of European Insurance and Occupational Pension Supervisors, and the European Commission are aware of the study and are very interested in its results.
So, after a successful and eventful first 10 years, here’s to looking forward to the decade to come.