NAPF 'regrets' EIOPA decision to press ahead with stress tests
The UK National Association of Pension Funds (NAPF) has met the European Insurance and Occupational Pensions Authority’s (EIOPA) decision to push ahead with controversial stress tests with “regret”.
James Walsh, EU and international policy head at the NAPF, told IPE: “It’s a shame EIOPA is pressing ahead with this exercise – we regret this decision.”
Walsh was commenting on EIOPA’s announcement that it would conduct stress tests on IORPs (institutions for occupational retirement provision), accompanied by another round of quantitative assessment – the specifications for both of which were published on Monday.
Walsh said: “EIOPA could find much more productive ways to use resources, as we have much larger problems in pensions right now.”
But the policy head also stressed that the NAPF would ask its members to participate in the exercise and that it was important the UK made a “credible contribution”.
“It would be most damaging if the outcome yielded figures with no resemblance to reality,” Walsh said. “If EIOPA determines to do this exercise, it needs to do it accurately, and, for that, solid data is needed.”
However, he agreed it would be difficult to get smaller companies to participate due to the costs and resources involved.
Walsh also questioned whether the fact EIOPA has “not made clear the purpose of the stress test” might make some stakeholders reluctant to participate.
He pointed out that EIOPA, in its own summary of reactions to the quantitative impact study, failed to quote a single stakeholder in favour of new stress tests.
“That in itself is quite illuminating,” Walsh said.
“It will be interesting to see whether EIOPA will change its proposal to the European Commission on the holistic balance sheet approach based on the outcome of the tests.”