Italian pension funds fight employer contribution portability

Italian pension funds urge withdrawal of portability in budget law 

Italian pension funds Assofondipensione is urging to withdraw the amendments to the 2026 budget law allowing the transfer of employers’ contributions to other forms of supplementary pensions that are not industry-wide pension funds Fondi Negoziali.

According to the association the new rule, if approved by the Parliament, undermines collective bargaining agreements underpinning the architecture of complementary pensions and industry-wide pension funds.

The portability of employers’ contributions exposes workers to the risk of switching to pension plans “with significantly higher costs and less transparent governance structures”, hitting pension benefits over time, according to the association. 

Assofondipensione told IPE that “several sub-amendments” have been tabled to change proposals put forward so far.

“We hope that corrective proposals eliminating the most critical aspects related to the portability will be accepted,” added president Giovanni Maggi.

Italy’s largest union General Confederation of Labour (CGIL) has also criticised the “unilateral decision” of the government opening up the portability of employers’ contributions “in the name of supposed neutrality”, weakening second pillar pension funds, Confederal Secretaries Lara Ghiglione and Francesca Re David said in a statement.

Industry-wide pension funds have a truck record of protecting members, contain costs, and direct investments according to socially responsible criteria, they added. 

Confederal secretary of Italian Labour Union (UIL), Santo Biondo, said that the transfer of employers’ contributions to other pension plans “often lacking transparent governance is unacceptable”.

Biondo pointed at the proposal included in the budget law to tranfer contributions open pension fund (fondi pensione aperti) established by banks, asset managers, investment firms, and insurance companies, open to everyone.

Sergio Corbello, the  president of Assoprevidenza, the association of the complementary pension sector, said that in the future contributions to supplementary pension schemes are likely to become a “subjective right”.

“Workers will be free to pay the contribution as they want, a topic that is also intertwined with the Pan-European Pension Product (PEPP) and pan-European reforms on pension schemes,” Corbello added during the Assoprevidenza’s annual general meeting held today.

Comprehensive changes tabled 

The 2026 budged law, now being examined by the budget committee, is bound for parliamentary discussion on December 22, to be approved by the end of the year.

Mefop, the organisation for the development of the pension fund market, has analysed the over 4.000 pages of amendments also reforming the 2005 legislative decree regulating supplementary pensions.

Some amendments point at strengthening the role of pension regulator Covip.

One amendment introduces a new silent-consent period, between April and September 2026, to automatically transfer the severance pay (Trattamento di Fine Rapporto - TFR) to a form of supplementary pension, if employees don’t make a choice on whether to keep it in the company or hand it over to a pension fund. 

Other amendments to the budget law propose to shorten the silent-consent period to 3 months, or 30 days, with automatic enrolment of the employees that have the right to opt-out, according to Mefop.

The silent consent mechanism “infuriates” the General Accounting Department (Ragioneria Generale dello Stato), which monitors public finances, concerned that severance payments would not flow to the treasury fund (Fondo di Tesoreria) of the Istituto Nazionale Previdenza Sociale (INPS), Corbello said 

Assoprevidenza proposed to enrol new workers in pension funds, but this idea was met with skepticism by the General Accounting Department, concerned that the flow of severance payments to the treasury fund, an income for the state, would decrease, and the amount of deductible contributions would increase, Corbello explained during today’s meeting.

Instead, a provision changing the limits for allocations to alternative investment funds (AIFs), particularly to infrastructure funds, was approved overnight in the budget committee, he added.