Fischer drops hints on EC pension reform green paper

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  • Fischer drops hints on EC pension reform green paper

EUROPE - Further hints of the contents of the European Commission's forthcoming green paper on EU pension legislation were aired at a conference in Brussels yesterday.

Delegates heard policy under consideration might include subjects such as investment strategy, balances between risks and benefits for pension schemes and default situations.

The paper, which is still under preparation, may also deal with issues such as how to ensure transparency and how Brussels could help EU member states, working from the current highly fragmented base, push towards regulatory coordination. 

The need to facilitate the mobility of "persons and pensions" was also touched on by the speaker, Georg Fischer, head of unit in the Commission.

Mr Fischer was speaking at the Second Annual Transatlantic Conference on pensions, which was hosted and organised by the Brussels-based European Association of Paritarian Institutions of Social Protection (AEIP).

The AIEP's aim is to promote social protection for its member organisations, located in 17 European countries.

Mr Fischer declined to give specific clues as to what may be in the paper, which could be tabled in two or three weeks.

However, he did inform the international gathering that "despite progress [in reforms by EU member state governments], there remain considerable risks to beneficiaries".

He added that their security could remain contingent on labour and financial markets, with "important risks remaining" if employment rates do not increase enough or if capital markets do not deliver as expected.

He noted responsibility for the design and delivery of pensions was in the hands of the member states.

For Europe's Frankfurt-based advisory body, the Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS), speaker Teresa Turner noted a survey result showing a "great diversity" in risk-management rules and supervisory practices in relation to IORPs.

Her address covered the development of a single EU rulebook, adding there was "no common view of how to go about it". 

She added the current prudential framework of IORPs was not "risk oriented".

Gerard Riemen, director of the Dutch VB, the association of industry-wide pension funds, repeated the pension fund industry's complaint against applying Solvency II rules, designed for insurance companies, to pension schemes. 

Insurance and pensions may look similar, he said, "but they are not".

"Pensions funds did not need billions of euros of financial support to survive the financial crisis," he added.

The European Commission, he said, had been unable to define IORPs because there are so many different types of them.

He added: "Of course we need solvency rules for pension funds, but we don't need Solvency II rules for pension funds.

"If we brought in Solvency II rules for pension funds, that would lead to lower pensions."

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