EC says directive is essential for single market
EUROPE - The proposed pensions directive is the most important part of the EC plan for a single market for financial services by 2005, said Jean-Claude Thébault of the EC at the EFRP/NAPF International Pensions Conference in Brussels, whilst reviewing the progress or otherwise of the directive that did not clear the hurdle of last week’s ECOFIN meeting,
However, Thébault noted that the signs of success were not very encouraging, pointing out that the mid-term point to the deadline of 2005 was close.
The real need was to get people to look beyond their national interests, he added.
He praised Austrian MEP Othmar Karas for the part he had played in pushing the report through the European Parliament in a very short time.
But, on the question of investment rules and taxation, he declared that the Parliament had a much more liberal approach than the Commission.
“It (the Parliament’s position) was going a little too far in the Commission’s view when you consider that the supervision levels vary widely between member states,” said Thébault.
The Commission had also rejected some of the other amendments of the European Parliament.
Thébault also added that the Belgian government, which took over the European presidency in July, had not given the same priority to pensions issues.
But there were other reasons for the slow progress, such as the delay in gathering information and the return of questionnaires due to the events in Afghanistan, he noted.
The current pensions situation, he said, reminded him of earlier days during the construction of the single market, with the abolition of barriers seen as a threat to national interests that outweighed the opportunities.
He pointed out that short-term considerations were prevailing over long-term benefits.
Addressing Commissioner Bolkestein’s call for mutual recognition on the regulatory side, he argued that the approach was floundering, blaming: “narrow and sometimes personal interests” in the Council.
Some member states, he said, felt the best way of ensuring a high level of protection of pension scheme members and beneficiaries was to impose quantitative restrictions on asset allocation and to seek harmonisation of the technical provision requirements within the EU
Not even the third life directive had such requirements on technical provisions, he countered.
“The prudent man rule suffers from a major misunderstanding.
“Many consider that this means full freedom to invest,” he added.
The Commission had made several attempts to relaunch the dialogue in recent months.
But despite the slowdown at a senior level, he hoped that the Commission’s efforts would lead to results.
People, he concluded, believed there was an education role to be carried out at a national level.
“The pensions industry is better placed than anyone else to do this.”
The need, he said, was to show that longer-term interests should prevail.