Once again, EU attacks our pensions

22 April 2018

Once again, EU attacks our pensions

For years now we've had to contend with Brussels' attacks on our pension system. The European Commission understands well enough that there is a general payment known as the AOW, but finds it nonsensical that there is also a compulsory supplementary occupational pension, in which employers also have to pay. In their view people should first and foremost take care of their own pensions as individuals. This wouldn't only be handy for the employers, but also mush better for insurance companies who would make handsome profits from it. The latest assault is known as the Pan-European Pension Product and consists of just such an individual insurance. Great news for the market fundamentalists, but in my view this proposed law will come to nothing.

Supplementary occupational pensions in the Netherlands are designed for workers, but a self-employed person generally qualifies only if he or she was previously receiving such a pension. Self-employed people in certain sectors can agree to establish a collective regime, but in such cases the decision as to whether to participate in the scheme is left to the individual. In the case of employees, solidarity was a deliberate choice, as evinced by the decision to make the supplementary pension obligatory. That gives peace of mind, preventing individual workers from postponing affiliation to a pension scheme on the grounds that one's retirement age still seems a very long way off. In my view the same goes for the self-employed. Young people in this situation will want to cut costs, but as they grow older, it can become practically impossible to build up a full supplementary pension. Just as for workers, this makes a collective regime important.

For the European Commission the solution does not lie with these compulsory supplementary pension regimes. They prefer to see pensions as free market products. It's the same old song: no solidarity, but instead via competition everyone can affiliate to a scheme that suits them. Yet it has long been demonstrated that individual insurance is dearer than the organisation of a collective regime. Moreover, existing pension funds can be tempted into offering a European Pension Product alongside the supplementary pension. If they do so, however, they fall directly under EU competition law and will be subject to critical scrutiny by the Commission to ensure that they aren't given preferential treatment in comparison to 'other market participants'. This is the umpteenth example of the unbridled 'market think' popular amongst neoliberal parties. In the European Parliament, I'll be trying to throw a spanner in the works of this plan, while my colleague in the SP's national Parliament group in The Hague will be doing the same, Solidarity must not be subordinated to the market. That's why the SP was founded.

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