EUROPE – The European Parliament’s economic affairs committee says multinational companies could save up to 40 million euros by pooling pension assets under the European occupational pensions directive.

“The directive will enable workers switching countries to take their pension with them and help multinationals to cut costs by offering staff a single, pan-EU pension scheme,” the parliament’s Committee on Economic and Monetary Affairs said. “A multinational could save up to 40 million euros if it pools its various schemes into one fund.”

“The directive comes as governments face increasing pressure to defuse Europe's pension time bomb caused by an ageing population.” It cited estimates that EU citizens need to save almost 500 billion euros a year to keep their current level of retirement benefits.

In its activity report for 1999-2004, the committee explained the parliament’s approach to the 12-year process behind the pension directive, Institutions for Occupational Retirement Provision.

It said the parliament displayed “expediency” in seeking a balance between the different practices across the EU. “The legislation is based on home country supervision of pension schemes, respect for national, social and labour legislation, and the ‘prudent person’ principle.”

“Indeed, the directive provides for the home state to lay down specific investment rules ensuring that the assets of the fund are invested in the best interests of the members, that the institution is registered and that it draws up an annual report and accounts.”