NETHERLANDS – Representative organisations of European employers, workers and pension funds have said they want to be heard in the political debate about the revision of the IORP Directive and the quantitative impact study (QIS).
In a joint statement, they expressed concerns that the holistic balance sheet (HBS) approach as part of the QIS would ultimately lead to a Solvency II-like supervision of pension funds, and questioned its feasibility.
The social partners said the public consultation by pensions authority EIOPA on the draft specification of the QIS in July had only reinforced their concerns.
They also lamented that the European Commission had failed to earmark issues such as sponsor support, pension protection schemes and risk margins for further investigation in the final QIS specifications.
They said Brussels should pay more attention to the fact that IORPs were long-term investors that contributed to the stability of the financial markets.
"At the moment, it feels as if the potential new rules push for short-term security at the expense of long-term investments and pensions adequacy," they added.
Matti Leppälä, secretary-general and chief executive at the European Federation for Retirement Provision (EFRP), said: "The QIS may seem very technical, but it is part of a deeply political process. It can have a big impact on the valuation methods for pension assets and liabilities, and therefore on the willingness of employers to provide supplementary pensions."
According to Leppälä, the use of the HBS would, in practice, be very difficult "due to the huge complexity and subjectivity of the underlying assumptions".
"What we need is a supervisory framework that recognises the unique characteristics of IORPs and is workable for employers and IORPs," he said.
The group includes the EFRP, the European Trade Union Confederation, the European Fund & Asset Management Association, the European Centre of Employers & Enterprises Providing Public Services, BUSINESSEUROPE, the European Association of Paritarian Institutions, the European Private Equity and Venture Capital Association and the European Association of Craft, Small and Medium-sized Enterprises.
Elsewhere, in a draft report for the Committee on Employment and Social Affairs, Ria Oomen-Ruijten, MEP and rapporteur on pensions, said she was very critical of possible quantitative requirements for pensions funds in a revised IORP Directive.
"Unlike commercial insurance schemes," she said, "pension funds are not designed to make a profit, but, as a rule, are an expression of solidarity within and between generations."
Oomen-Ruijten warned that increased capital adequacy requirements would increase costs, "jeopardising the adequacy of pensions of current and future pensioners".