European Union member states must promote “collective” pension savings vehicles, the European Commission has urged.
Releasing its annual growth survey, the European executive also praised efforts by a number of countries in reforming their first-pillar pension systems, arguing that a majority of member states had amended systems to “better withstand” the impact of increased longevity.
It noted, however, that the reforms could result in further “challenges” and insisted that, to ensure the success and continued support of state pension reforms, steps needed to be taken to maintain retirement income levels, extend working lives or provide other sources of income through “complementary” pension savings vehicles.
“Member states,” the report continues, “need to support the development of collective and individual pension plans to complement public pension schemes, including by removing obstacles at European level.”
Social partners, it says, also have an important role to play, depending on the circumstances.
The reference to collective and individual pension plans is likely to be an attempt to present both second and third-pillar pension saving as viable ways of increasing income on retirement.
Olivier Guersent, the most senior civil servant within the Financial Stability, Financial Services and Capital Markets Union directorate general, recently suggested the pan-European pension product developed by the European Insurance and Occupational Pensions Authority (EIOPA) could play an important role in developing pension saving where occupational systems were not in place.
At the same event, EIOPA chairman Gabriel Bernardino suggested there was space for a pan-European occupational defined contribution system.
The Commission’s report comes only a few months after social affairs commissioner Marianne Thyssen argued in favour of greater supplementary savings, while acknowledging the “limited” ability of many households to contribute to such systems.