The European Commission today presented a proposal for a Pan-European private pension product. The draft regulation for European pension products called “PEPP” (Pan-European Pension Product) is intended to set European rules and quality standards for retirement provision products. This would make these pension products comparable and transferable to other countries across the EU. Insurance companies, banks, funds or asset managers would be able to offer these products throughout the EU. Commenting on the proposal, the economic and financial policy spokesman for the Greens / EFA Group in the European Parliament, Sven Giegold, says:
“With a Pan-European pension product, Europe grows further together. It will be a great relief for European citizens to take their private retirement with them when they move to another country. The Pan-European pension would be the first truly European financial product for consumers. If the same rules apply to all providers, the consumer benefit from a genuine European competition among insurance companies. Currently, banks, insurance companies and funds apportion the unreasonably high costs amongst consumers. By increasing the choice of products and improving comparability, the costs for consumers will be reduced significantly by the Pan-European pension product. Due to a uniform European definition, consumers are more likely to use better and cheaper products from other Member States. The Pan-European pension thus promotes the integration of the capital markets union. I welcome that the European Insurance Supervision (EIOPA) takes the lead in supervision. Yet, the PEPP is, of course, no substitute for highly cost effective models such as the public Swedish pension fund which has helped Swedish citizens to profit from the capital markets with only 10% of the usual costs.
The German Government should discard its objections to the Pan-European pension and support the proposal instead. In the Council of Financial Service Committee (FSC), the German Government had criticized the potential interference with national security systems. This criticism from Berlin, regarding European progressive ideas is an old hat. Whilst the German Riester pension puts a financial burden on consumers, the Pan-European pension would offer them more for less money. In order to make the Pan-European pension a success, Member States ought to promote it as much as national products. The Greens in the European Parliament will strongly advocate for a decision to support the Commission proposal.”