EUROPE - Misgivings about the European Commission's proposed directive on pensions portability have continued to emerge, with the latest salvo coming from the National Association of Pension Funds in the UK.
The current round of debate was sparked off by social partners in Sweden and the Netherlands. A group headed by Confederation of Swedish Enterprise director general Urban Backstrom wrote to the Financial Times last month saying the proposal needed to be "seriously reconsidered".
"The social partners must be allowed to continue to share conditions of supplementary pensions, which are both conducive to mobility and provide for sustainable solutions, based on the specificities of our different labour markets," they said.
Ria Oomen-Ruitjen, the European Parliament's rapporteur for the proposed directive responded, acknowledging that it was "clear there is a limit to what can be achieved by this directive".
She wrote: "The fiscal treatment of pension entitlements is not covered by the proposal, but there is unfortunately no common ground for EU rules on that thorny issue."
But she wondered whether it was right to stop trying to tackle problems related to transferability of pension rights as it was being suggested.
Now NAPF chairman Robin Ellison has weighed in, saying the whole debate "misses the point".
"The issue is not whether the social partners should be involved, nor whether European Union workers should have a ‘right' to an occupational pension. The real issue is whether the proposal is likely to achieve its objectives or not."
It was "all too likely that well-intended, but misguided, EU legislation will fail to enhance pension portability and make employers less likely to offer a good pension at all".
Ellison wrote today: "There is a real risk that EU rules will have unintended consequences and place new burdens on pension schemes just as the UK government is trying to adopt a more flexible approach."