NAPF tells EU to stay out of pension legislation January 2012
Posted date: 5 January 2012
The National Association of Pension Funds (NAPF) has hit out at plans to introduce new European Union (EU) pension regulation, claiming the EU “should not try to fix a problem that does not exist”.
The NAPF has sent a stark warning to employers that the cost of the legislation to defined benefit schemes could be an additional £300 billion. If the proposed law goes ahead, it may have major consequences for the economy and the jobs market.
The European Insurance and Occupational Pensions Authority has suggested that a “Solvency II type capital regime” be introduced to ensure high funding levels. This type of system, which is designed for insurance firms, would make the provision of workplace pensions more expensive.
Joanne Segars, Chief Executive of the NAPF, emphasised that although it supports the objective of making pensions more secure, this kind of regulation would have the opposite effect.
“Solvency II type rules would not only put additional pressure on companies that are struggling for survival, but would also force them to divert money away from investment and new jobs,” she said.
In the UK there are already several bodies and systems in place to protect retirement savings, such as the employer covenant, The Pensions Regulator and the Pension Protection Fund. The NAPF believes that these are mechanisms are sufficient.
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- January 2012
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