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Report on occupational retirement pensions

Brussels, 11.03.2003

Precedence for Lifelong Pensions

Retirement cover: three-pillar approach needed

The European Parliament will be making a number of important decisions this week during the second reading of a report on occupational retirement provision. The Parliament will have in front of it a report from MEP Othmar Karas. The EUCDW welcomes that amendment 1 points out the importance of public pension systems which must be at the centre of the objective of strengthening the European social model.

For the EUCDW it remains that the public pension system must ensure that each individual involved can lead a qualitative, humane life. The main task is to lastingly protect this system.

Additional systems of occupational retirement schemes (second pillar), which must be available to all employees, and of private retirement provisions based on capital formation (third pillar) can complement this. In a converging European employment market, it is therefore just as necessary to have Europe-wide regulations on cross-border methods for ensuring that pension entitlements can be met as it is to have rules on capital investment.

Securing an adequate lifelong income for people during their retirement is one of the core requirements of this draft report on occupational pension funds. Payments of one-off, lump sum amounts are not made impossible per se by such requirements (as they are used to fund the purchase of pension provisions for instance). However, precedence should be clearly given to lifelong, monthly payments.

Indeed, longevity of life is itself one of the so-called 'biometric risks' facing society. Others are the need to provide care for surviving dependants (widows' and orphans' pensions) and for cases of invalidity. Cover is called for here too, if employee and employer are agreed on it. For this, according to the ideas of EUCDW, solutions and options should be found at least on company level, even better beyond company level; the individual employee should not be left alone.

Another important element is the transparent, comprehensive and regularly updated information for those insured. Available not at their request, but automatically.

With his subsidiary approach, Othmar Karas is fully in line with what has already been discussed within the EPP and EUCDW. Our goal is a transparent, subsidiary and focussed system of enhanced retirement provision that can help to maintain the core public system of universally financed pensions.

The European Union of Christian Democratic Workers (EUCDW) consists of 23 workers' organisations from 15 countries and is an association of the European People's Party (EPP).

responsible: Elmar Brok MEP, President.

EUCDW
European Union of Christian Democratic Workers
c/o EPP, Rue du Commerce / Handelsstraat 10
B-1000 Brussels
E-mail: EUCDW

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