The European Commission has launched a Europe-wide public debate today on
how the EU can best support member states in their difficult task of ensuring
they provide their citizens with adequate, sustainable and safe pensions – both
now and in the future.
Against the backdrop of demographic ageing and the additional challenges
brought by the financial and economic crisis, the Green Paper seeks views on
whether and how the EU level pension framework should be adjusted.
The paper does not make firm specific proposals at this stage, but poses a
series of questions inviting all interested parties to contribute views,
opinions and ideas on confronting the pension challenge - one of the biggest
facing Europe and most parts of the world today – and how the EU can contribute
to the solutions.
Presenting the consultation paper, with the full backing of Commissioners
Olli Rehn (Economic and Monetary affairs) and Michel Barnier (Internal Market
and Services), László Andor, EU Commissioner for Employment, Social Affairs and
"The number of retired people in Europe compared to those
financing their pensions is forecast to double by 2060 - the current situation
is simply not sustainable. In addressing this challenge the balance between
time spent in work and in retirement needs to be looked at carefully.”
Mr Andor added: “The choice we face is poorer pensioners, higher pension
contributions or more people working more and longer. One of the great
successes of Europe’s social model is to ensure that old age is not synonymous
with poverty. This is a promise on which we have to continue to deliver and the
dialogue we are launching today should help member states take the right
decisions to ensure pension systemsare fit for purpose".
The Green Paper reviews the European pension framework in a holistic and
integrated manner including areas such as: longer working lives, the internal
market for pensions, mobility of pensions across the EU, gaps in EU regulation,
the future solvency regime for pension funds, the risk of employer insolvency,
informed decision-making and governance at EU level.
In particular, it addresses:
- ensuring adequate incomes in retirement and making sure pension systems
are sustainable in the long term
- achieving the right balance between work and retirement and facilitating a
longer active life
- removing obstacles to people who work in different EU countries and to the
internal market for retirement products
- making pensions safer in the wake of the recent economic crisis, both now
and in the longer term
- making sure pensions are more transparent so that people can take informed
decisions about their own retirement income.
The paper makes clear many aspects of pension systems are the responsibility
of member states, such as setting retirement ages and whether people should
take out private pensions. But in areas where the EU has competence to
legislate the Commission stands ready, and in particular to revise existing
legislation, if it considers appropriate following analysis of replies to the
The regulatory framework at the EU level covers four main points:
1. cross border coordination of social security pensions to facilitate the
free movement of workers and equal treatment for workers who change
2. establishing an internal market for funded occupational schemes and the
necessary minimum standards on prudential rules to protect scheme members and
3. minimum guarantees concerning occupational pensions and accrued rights in
case of the insolvency of enterprises as sponsors;
4. anti-discrimination rules apply, although with some differentiation, to
both statutory and private pension schemes.
Beyond this, there is a coordination process (the open method of
coordination) used to facilitate and promote national reform, share best
practice and set high level objectives and indicators. At EU level the
agreed objectives for pension systems are that they are adequate and
sustainable, as well as being modern and transparent.
The consultation period will run forfour months (ends 15
November 2010) during which anyone with an interest can submit their views
via a dedicated website
or in writing to European Commission, Green Paper on Pensions consultation,
Directorate-General for Employment, Social Affairs and Equal Opportunities –
Unit E4, B-1040 Brussels, Belgium.
The European Commission will then analyse all responses and consider the
best course for future actions to address these issues at EU level.