More than 40% of German Pensionskassen said they reject the idea of introducing plans with no guarantees, according to a survey by Willis Towers Watson.

Only one quarter thought the introduction of defined contribution (DC) pensions to Germany from next year would be a “chance for their business”.

This Friday, the second chamber of the German parliament will on the current draft of the “Betriebsrentenstärkungsgesetz” (BRSG), a government reform plan for the second pillar. This is the last hurdle before it becomes law.

Willis Towers Watson surveyed 23 Pensionskassen with around €36bn in assets in April and May, and found these pension vehicles were not enthusiastic about the new law.

“For companies that are not yet offering an occupational pension plan for their employees, the new law offers positive impulses,” said Reiner Schwinger, head of the Northern Europe region at Willis Towers Watson Germany. “But it does not really appeal to companies already offering occupational pensions.”

Should the BRSG pass parliament on Friday, representatives of workers and employers in each industry (the so-called “Tarifparteien”) will be able to negotiate defined contribution plans through a vehicle of their choice – be it a new provider or an existing one that has added the new model to its range of products.

Companies can then decide whether or not to join the new pension plan completely and close old arrangements for new entrants.

Alternatively, companies can choose to stick to their existing pension arrangements – but they are not allowed to switch to non-guaranteed plans without signing the collective bargaining agreement for the industry.

The survey also revealed that Pensionskassen were more concerned about European and domestic regulations and the low interest rate environment than any reforms affecting the second pillar.

More than half of the surveyed Pensionskassen said the new law would not have any effect on their business.

When asked about regulation, 61% said this remained the greatest strategic challenge for the foreseeable future. Stress tests and excessive regulation were also among the main worries.

In the last BaFin stress test, eight of 123 tested Pensionskassen failed to meet the German supervisor’s requirements.