A Finnish pensions association has criticised the requirement in the European Commission’s new IORP Directive for pension providers to issue scheme members with a uniform pension benefit statement for being unfair competitively.
The Association of Finnish Pension Funds (ESY) said the way the standardised communication to customers was formulated was wrong and having such a requirement meant pension funds had a bigger administrative burden than life insurance companies.
Ismo Heinström, lawyer for the association, told IPE: “It is regrettable that the pension benefit statement is formulated as if an IORP were an investment fund with totally different principles and objectives.”
The kind of information demanded in the statement was not provided by insurance companies which had similar conditions, he said.
He asked whether an IORP should therefore have to provide this extra information, when the commission laid weight on creating a level playing field for pension providers.
Heinström said members should always be provided meaningful and relevant information.
“The suggested pension benefit statement would provide members and beneficiaries unnecessary and misleading information not provided in insurance schemes with conditions that are in principle similar,” he said.
The requirement would result in an unnecessary increase in costs for both the IORPs and the employers behind the schemes, Heinström said.
On the whole, Finnish occupational pensions funds were well run, he said, and the institutions had so far provided their members with sufficient information.
The Dutch Pension Federation previously criticised the revised IORP Directive’s proposals for a uniform statement as “overkill”.