French pension associations merge
FRANCE – Agirc and Arrco, the two French caisses de retraite supplementary retirement fund associations, have merged to form one new umbrella association, Groupement d’Intérêt Économique AGIRC-ARRCO (GIE Agirc Arrco).
Agirc is the executives’ and managers’ association whilst Arrco represents all other salaried workers. The new umbrella group will be based in Paris.
The rationale behind the move is to streamline the caisses de retraite market by eliminating unnecessary competition between those offering the same product and in preparation for 2004, when the number of supplementary caisses de retraite groups is to be limited to a maximum of twenty five.
The 25 re-organised retraite groups will each contain just one Agirc and one Arrco caisse and be divided geographically around France.
Since the beginning of this year, new companies may only join a caisse de retraite in their geographic area or which covers their industrial sector.
Under the existing set-up, companies may choose to become a member of any caisse de retraite, irrespective of location or sector.
This has led to competition between caisses offering the same product which many in the industry in France see as unnecessary and a hindrance to future development of the French savings and pensions system.
A company may still be a member of either a Agirc or Arrco caisse, since the re-organisation doesn’t affect membership criteria based on employee, but the new organisation takes some of the administrative burden away from the company by allowing it to make just one overall contribution which GIE Agirc Arrco separates accordingly.
Agirc and Arrco will continue to run their caisses independently but there will be a new management board for the umbrella ‘GIE’ which will be composed of equal numbers of members from each association.