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It follows the fourth edition of a Better Finance report that aims to show the real returns of pension savings – after charges, inflation, and taxes – in 15 European countries.
The 2016 report, published in September argued that once inflation, charges and (where possible) taxes were taken into account, private pension products have often performed poorly.
“Unfortunately our research findings show that most pension savings did not, on average, return anything close to those of capital markets, and in too many cases even destroyed the real value for European pension savers (i.e. provided a negative return after inflation),” said Better Finance.
However, PensionsEurope criticised the report in a paper published last week, which included hard-hitting comments from its member associations in Bulgaria, Germany, Italy, and Spain. PensionsEurope said these organisations had found “substantial discrepancies and wrong interpretations”.
The European occupational pension fund trade body was at pains to strike a constructive tone, however. It suggested areas of improvement, and welcomed “the research on the quality of occupational and personal pensions and the outcome of pension savings”.
Janwillem Bouma, chair of PensionsEurope, said: “In [our] paper, we highlight numerous specificities that the research should take into account in order to give a realistic picture of the quality and outcome of pension savings. If ignoring these specificities, the research faces a serious challenge of comparing apples and pears.”
“Our research goal is far more specific and far less ambitious than the one Pensions Europe highlights in its headlines: the aim is not to analyse ‘the quality and outcome of pension savings’, but to improve the transparency on the real returns of pension savings in Europe,” Better Finance said.
It called on trade associations to help plug a data gap and improve the transparency of data on pension returns, “since the bulk of the criticism aimed at the report by Better Finance originates from the lack of available data on returns”.
Both organisations have noted that the European Commission wants the European financial supervisory authorities to carry out out work on the transparency of long-term retail and pension products, including an analysis of actual net performance and fees.