NEWS

ESC: WE NEED A STRATEGY FOR VOLUNTARY PENSION PROVISIONS IN LINE WITH THE EUROPEAN PARLIAMENT PROPOSED REGULATION ON THE PAN-EUROPEAN PERSONAL PENSION PRODUCT

The Economic and Social Council adopted an Opinion on the Proposal for a Regulation of the European Parliament and of the Council on a Pan-European Personal Pension Product (PEPP) COM/ 2017/343 final". The idea of ​​the proposal is to create a pan-European product for personal retirement provision for all Member States and thus promote savings for old age by ensuring long-term sustainable income for older people. ESC shares the view that it is necessary to further develop existing national supplementary pension schemes with new products and notes that EP's proposal will primarily facilitate mobile workers, self-employed workers and workers in different Member States. 

However, ESC also raises the question of how much the proposed draft Regulation will also ensure that the additional voluntary pension insurance currently in place in Bulgaria and in other countries is sustainable and adequate in the future.

ESC also draws attention to the extent to which PEPP will be able to perform the function of universal investment product across the EU as it is related to the national specificities of the social policy and pension policies of each country.

In the Opinion, ESC supports the serious attempt of EP, the Council and the EC to create a sign of quality and security of personal pension products and to increase the confidence in them as well as to ensure wide choice of providers of these services. However, well-established and long-standing providers of voluntary pension funds offering personal pension products should also be included in the list of providers.

ESC agrees that when the poverty rate among the adult population is high, as it is in Bulgaria, and the solidarity insurance system is unable to provide adequate income, it can hardly be expected that the PEPP will guarantee the desired high growth of the pension savings. Therefore, ESC has accepted the proposed regulation as an initial stage for the construction of a pan-European third-pillar pension market rather than as a means of financing the capital markets through the additionally accumulated funds in personal pension assets.

The proposal for a regulation aims to help cross-border tax obstacles to long-term pension savings. ESC draws attention to the fact that the introduction of this product through a regulation rather than a directive may cause reluctance for some Member States to voluntarily accept the recommendation on the tax treatment of products for personal retirement provision.

Last but not least, ESC recommends that the governmental institutions, in partnership with the social partners, the non-governmental sector and academics, develop a long-term strategy for the development of the third pillar of the pension system in the context of the PEPP and offer adequate solutions for the future development of personal and professional voluntary pension insurance.

MISSION

“THE CIVIL PARLIAMENT” OF BULGARIA

is the “bridge” between citizens and the national government. Its mission is to support such “bridging” so as to facilitate the communication between the society and the national government. It is the new and modern institution of the civil dialogue.

The ESC's mission is to promote civil society organisations access to and involvement in the process of decision-making on strategic economic and social issues.

The main goal of ESC's operation is to enable different representatives of organised civil society to feel free to state their views whereas unanimity on matters of common interest is encouraged. The Council expresses and protects civil society interests by communicating agreed statements and proposals submitted by its members to the executive and legislative authorities.

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