Portability plan in limbo
Despite the commission’s prevailing optimism that last-minute tweaks would have saved its pensions portability proposal from sinking beneath a quagmire of inter-governmental wrangling, those that are now handling the dossier say that it is looking decidedly more troublesome than they first allowed for.
For one thing, Austria, which currently has the EU presidency, had hoped that an initial discussion about the issue could take place during a meeting of social affairs ministers in March, with a view to reaching political agreement by the end of June.
But council sources say that, due to the delicacy of the proposal, Austria will not be ready to kick off discussions for the next couple of months, meaning that Finland will be left to decide how best to push the dossier forwards when it takes over the presidency in July.
“If things go very well, then there could be a first reading under the Austrian_presidency in early June,” one council source said.
The European parliament has also had to readjust its timetable for
drafting a report on the proposed directive.
Dutch liberal MEP Ria Oomen-Ruijten, who started looking at the matter at the start of February, says that she had optimistically hoped agreement between MEPs could be reached as soon as September, but admits that, on closer consideration, this will now have to be pushed back, possibly until next year.
Oomen-Ruijten says it is too early to say in what direction her report will head. At the moment, she is simply trying to assess the mood inside and outside of the parliament, and see where the difficulties lie. She accepts that the commission’s proposal is a very technical one that raises some potentially divisive issues, and therefore needs to be dealt with carefully.
There are some worries that Oomen-Ruijten could be swayed by her national roots. The issue of pensions’ portability does not frighten the Dutch as much as it does some other member states that have rather looser pension regulations which may need to be tightened under the new legislation. “It remains to be seen whether the rapporteur will be more Dutch or more liberal,” mused one policy adviser at Age, the older person’s platform.
The European Parliament’s Pension Forum (EPPF), which regularly meets to discuss key pension issues, says that it is trying to co-ordinate its work with that of Oomen-Ruijten. It is expecting to be able to organise a meeting on the issue at the end of March or early April, depending on the progress that the MEP makes with her report.
The commission has always accepted that getting member states to agree on portable pension rights would be difficult. In an interview held before the text of the directive was published, Vladimir Spidla, the commissioner in charge of the dossier, admitted that his proposal could upset some member states by treading on national pension systems. This was why his team of officials spent so long trying to slim down the proposal to the bare minimum.
Now, having worked so hard to make the legislation as inoffensive as possible without undermining its effectiveness, the commission is keen to shrug off any suggestion that all is not well. “We have always said that the sooner the directive is adopted, the better,” a commission spokeswoman said. “We have given careful consideration to the specific situation in individual member states, such as with Germany’s book reserves, and we believe that now is the time to go forwards.”
Pending agreement between member states and the European parliament, the directive should become law by 1 July 2008.
Finance ministers have greeted the latest set of doom-and-gloom demographic projections from the commission with lukewarm enthusiasm, with many member states questioning their reliability despite repeated assurances that they are the most “comprehensive and comparable” yet.
This latest report, which was prepared jointly by the commission and the Economic Policy Committee, seeks to show that reforms do help mitigate the future impact of ageing, and member states who have undertaken some degree of restructuring tend to fare better in the projections.
Finance ministers had the first chance to assess these latest figures when they met in Brussels on 14 February. While publicly ministers made bland statements about their continued commitment to reform, behind closed doors they were much more scathing about the value of being told, yet again, what poor demographic shape Europe is in at the moment.
In a typical intervention, Portuguese finance minister Fernando Teixeira dos Santos complained about the practicality of taking such vague projections, where the benefits of reform are so subtle and the costs so obvious, back to the electorate. The minister underscored the commission’s own admission that many of the assumptions made in the report are “fragile” and ignore such developments as technical and scientific breakthroughs. He said that there was a danger that the figures would be perceived by the public as “unavoidable”, rather than just as predictions that could be altered.
The report was to go last month into the EU’s Spring summit, which is the annual meeting of Europe’s leaders that traditionally addresses how Europe is faring both economically and socially.