Brussels postpones introduction of pillar one for revised IORP
EUROPE – The European Commission has postponed the implementation of pillar one of the revised IORP Directive, which focuses on capital requirements, arguing that the solvency rules should be an “improvement for the pensions sector, rather than a punishment”.
Speaking at the Global Conference on Sustainability and Reporting in Amsterdam today, Michel Barnier, the EU commissioner for internal market and services, has told pension representatives that, taking into account the preliminary results of the quantitative impact study (QIS) published by the European Insurance and Occupational Pension Authority (EIOPA) last month, the EC has decided to postpone the implementation of pillar one in the revised directive.
IPE understands that the announcement was not made during his opening remarks in the morning but later during the day, either at a press point or during talks with pension representatives.
According to the Brussels-based association, PensionsEurope, Barnier said that, due to the large diversity in pension systems in Europe, it was “impossible to develop good rules that fit all systems in the short term” and that more research was needed.
Consequently, it added, the European Commission will only propose rules for transparency and governance for IORPs in the autumn.
PensionsEurope pointed out that Barnier failed to provide any details on the new timetable for the possible introduction of solvency-based measures for occupational pensions.
But he said he expected the quantitative rules would be a job for his successor, after a new group of commissioners takes over next year.
Matti Leppälä, PensionsEurope secretary-general and chief executive, welcomed the move and said Barnier made the right decision, as it was “vital” to take more time for a thorough analysis of the effects of possible changes in solvency rules, which “differ greatly” among member states.
“The European pension funds and other IORPs have to be able to contribute to the growth of the European economy and employment, and the solvency rules have to enable this,” he said.
“The changes in the pensions landscape, and especially the shift from defined benefit to defined contribution schemes, pose many new challenges in pension fund governance and disclosure of information to scheme members and beneficiaries.”
Earlier this week, IPE reported that some sources in Brussels suggested the timing might be right for Barnier to make an announcement on the IORP framework.
Some of the key changes concerning the new directive came when the pension industry least expected it.
The delay of the directive, as well as the Green Paper on Long-Term Investing, were announced at the InsuranceEurope annual conference last year.
Contacted by IPE, a spokeswoman for the commissioner declined to make any further comments.