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It is unusual for the full range of ‘social partner’ organisations (representing employers and employees) to work together in this way, and the letters underline the serious concerns about the potential damage to pension provision, jobs and investment.
The letters have been sent to the President of the European Commission (José Manuel Barroso) and to the European Commissioners for the Internal Market (Michel Barnier), Economic Affairs (Olli Rehn) and Employment and Social Affairs (László Andor).
As employers, employees and pension schemes, the signatories would all emphasise that they strongly support the Commission’s objective of ensuring pension scheme members benefit from risk‐related regulation. But the funding measures currently envisaged by the Commission fail to achieve this. By demanding dramatic increases in funding from employers, the Commission’s plans would – at best – force all remaining defined benefit schemes to close and – at worst – push many businesses into insolvency, leading to significant job losses. Far from benefiting employees and protecting scheme members, this would create a system in which job creation would be seriously hurt and pension provision inevitably damaged.
The proposals would threaten long‐term economic growth in two ways. First, the increase in funding requirements would substantially raise the cost to companies of providing occupational pensions. This would force them to divert money away from investment in growth, job creation and R+D.