German social partners representing employees and employers have slammed political parties for a lack of new ideas and proposals for the next legislative period on occupational pensions that might hinder the take up of defined contribution pension plans among employees.
In the electoral programme for the Union, the alliance between the Christian Democratic Union (CDU) and the Christian Social Union (CSU), the term ‘occupational pension’ is not really mentioned, Elvira Wittke, lawyer at the union IGBCE, said during the occupational pension conference bAV-Autakt last week in Berlin.
It is mentioned only to underlying the parties’ support for small and medium-sized employers signing up for company pensions, she added.
The Social Democratic Party (SPD) is campaigning ahead of the elections to make company pensions attractive for employees, sticking to collective bargaining agreements between social partners paving the way to expand DC pension plans in companies, akin to the second pillar reform drafted by the traffic-light coalition government of the social democrats (SPD), Greens and liberal party (FDP).
IGBCE thinks that the second pillar reform drafted by the traffic-light coalition government wasn’t a game changer, but it was a step in the right direction.
However, the new government, likely led by the Union, could decide to review the reforms started by the traffic-light government, creating uncertainties for social partners and the occupational pension industry.
The FDP, instead, wants to boost equity investments for company pension schemes, and allow pure DC plans for all companies, ditching collective bargaining agreements and a reform of the social partner model.
“If you look at the electoral programmes of other parties, the world of occupational pensions is out of place, the focus is not on that,” Wittke added.
Alexander Gunkel, member of the executive board of the Confederation of German Employers’ Associations BDA, added during the event last week that pension proposals of the two major parties, CDU and SPD, on occupational pensions mirror the second pillar reform draft.
“Otherwise there is nothing else in the proposals”, Gunkel said, adding that the lack of ideas won’t lead to boosting occupational pensions.
BDA is pushing to change the rules on the social partner model and DC plans without liabilities for employers. The employers’ association believes that the second pillar reform drafted by the traffic-light coalition government fell short of expectations.
IGBCE demands that the level of guarantees, corresponding to the amount of contributions, is cut in the DC pension plans (Beitragsorientierte Leistungszusage, BoLZ) only within the framework of collective bargaining agreements.
“The issue of the reduction of the guarantees for BoLZ [pension promises] wasn’t included unfortunately in the second pillar reform [of the traffic-light coalition government]. We are in a grey area,” Wittke said.
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