On 31 March 2011 the CEEC Forum convened in London to discuss the EU-level developments to enhance the Stability and Growth Pact. The pact takes a very short-term view by focusing on the deficit ceiling of 3% of GDP and the gross debt limit of 60% of GDP. Therefore, the CEEC Forum agreed in saying that the Euro Plus Pact is a missed opportunity to align the Stability and Growth Pact to longer time horizons as is the case today. This has already led Hungary and Poland to reverse pension reforms establishing a mandatory funded pillar, and there is a possibility that other countries may follow suit.
Mr. Csaba Nagy, EFRP CEEC Forum Chairman said: “The Stability and Growth Pact should take into account the introduction – as well as the reversal - of funded pension systems on a permanent basis. Europe cannot afford to encourage short-sighted policies that threaten the adequacy and sustainability of future retirement income”.
The original Commission’s proposal to the European Council allowed funded pension systems to be considered when assessing compliance with the deficit and debt criterion of the Stability and Growth Pact, but only for a transitional period of five years. The ECOFIN Council of 15 March 2011 reached a general approach on the economic governance package. This considers multi-pillar pension systems on a permanent basis, but just their set-up and implementation and not their reversal. Hence, Member States will continue to have an incentive to claw back pension assets from universally mandatory systems, which we consider inappropriate.
The CEEC Forum was established in 2006 under the umbrella of EFRP to discuss common challenges to the pension systems in the Central and Eastern European countries.
Press release
© EFRP - European Federation for Retirement Provision
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article