EFRP to update occupational retirement proposal
EUROPE – The European Federation for Retirement Provision is to publish a follow-up report to the European Institution for Occupational Retirement Provision proposal.
The original report was put to the European Commission in September 2000 as a potential solution for the creation of tax-neutral pan-European pensions.
Alan Pickering, chairman of the EFRP, says the organisation will issue EIORP report mark II next month. The new report will update the organisation’s pre-pensions directive plans for a workable single institution for cross-border retirement incorporating individual sections corresponding to national taxation regimes.
“The report will restate the case for an optional EIORP for those who want it,” Pickering said.
“We want to take account of the directive and the EC tax communication then suggest what needs to happen in the next couple of years in the hope that by 2005 when the Directive is fully operational, then the EIORP option will be achievable as well.”
More specifically, the chairman says the document will draw attention to the further tax changes as well as the regulatory balance between home and host country that would be necessary for the EIORP to work.
“We will be trying to do that in a sensitive fashion – acknowledging that ultimately home country supervision is all that is required until we have the necessary trust in Europe to do otherwise, and that we might as a transition have some sort of host country governance structure.
“The publication of the report will hopefully act as a focal point reminding local legislators introducing the directive that they might want to have in mind the impact that it will have on the country’s citizens, be they corporates or individuals, who have a cross-border dimension to their existence.”
In the coming months, Pickering says the EFRP will also issue an evaluation paper looking more closely at the impact of the directive and echoing two themes that he would like to see given prominence.
The first, he says, is his desire to see the EFRP working more closely with organisations such as investment fund body FEFSI, the Fédération Européenne des Fonds et Sociétés d'Investissement, and the Comité Européen des Assurances insurance body, or CEA.
“Hopefully this will not be just on a bilateral basis, but a tripartite level where there is a common interest for the organisations,” he notes.
The second thing, he opines, is to ensure the EFRP plays its part during the two-year implementation phase of the directive.
“We want to look at exactly what it means on a country-by-country basis and try in a modest way to influence the way it is implemented in each country so that it makes sense both domestically and internationally.
“Governments have to implement the directive, but what we don’t yet know is whether they are gong to implement the spirit or the detail.
“I’m much more keen on incorporating the spirit in legislation and allowing market participants and social partners to hammer out the detail. It would be sad if politicians try to copperplate the directive into domestic provision, which could make it more expensive than it is and even more difficult to have cross-border pension provision.”