EUROPE - The European Fund and Asset Management Association has laid out its blue print for pan-European pension accounts for the occupational market under the EU directive.
The new vehicles, known as European Personal Pension Accounts (EPPA), would be implemented in the second pillar pension market, offering a range of investment options representing different risk profiles.
Wolfgang Mansfeld (pictured), president of EFAMA, said the accounts reflected characteristics of pension accounts already offered at a national level in some European countries but with the advantage of access to a European passport.
He said the association had begun discussions with the European Commission over the possibility of implementing the proposed accounts, which he believes would foster pension portability - a goal high on the EU agenda.
“The EPPA concept offers a practical response to the lack of job mobility between EU countries, which is one of the huge shortcomings of European integration,” he said. “What is needed is to allow people to accumulate their pension rights in personal accounts and transfer their account balance from one provider and country to another when changing jobs.”
Mansfeld said many of the barriers to the portability of pensions, particularly across borders, were “better handled” with individual pension accounts. He noted the valuation of account assets as one problem that did not exist with personal accounts.
Bernard Delbecque, rapporteur on the EPPA project at EFAMA, said the accounts were also appropriate for third pillar pensions, although he added there was no directive that would allow a third pillar EPPA to obtain a European passport.
Pension vehicles similar to the concept proposed by EFAMA include the Personal Retirement Savings Account (PRSA) in Ireland, the Plan d’Epargne Retraite Collectif (PERCO) in France, the Individual Pension Savings (IPS) in Sweden, the Individual Retirement Account (IRA) in Poland, the Riester Pension in Germany and the Pension Saving Funds (PSF) in Belgium.
EFAMA wants the European Commission to act as facilitator in its aim to have EPPA form part of the Lisbon Strategy.
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