Brussels, 08/03/2011 (Agence Europe) - EU ministers for employment and social affairs held a debate on Monday 7 March on the modernisation of pension systems, an important subject in terms of economic growth and balancing the budget. This subject is the theme of the Commission Green Paper on pensions and is top of the agenda for European citizens because everyone would like to enjoy the security of a retirement based on the number of years they have paid into their pension (which should never be discounted and which will be taken into account). As part of the debate, the EPSCO Council held a very far-reaching discussion on three essential and closely linked aspects: appropriateness, sustainability and pension security. Ministers also discussed budgetary constraints and financial limitations. The Hungarian Presidency speaking through its minister for national resources, Miklos Réthelyi, expressed its hope that this debate could help contribute to the drafting of the Commission White Paper on pensions, which will be published in the third quarter of 2011.
During the debate, ministers for social affairs suggested that the retirement age in Europe be increased and that the scope for taking early retirement be limited. No objective, however, was set out and they pointed out that funding and reform of the pensions systems fell within the remit of member states. There are, nevertheless, common challenges that EU countries have to discuss together: an ageing population, budgetary challenges, financial reform, the integrated nature of the European financial market and the need for controls, explained Lázsló Andor, the commissioner for employment. Member states exchanged their experiences and good practices on pension systems.
A subject of common interest involved reform of the pension systems and the challenges accompanying this issue: it is not simply a question of the sustainability of pensions but also one involving the free movement of workers that enable European labour markets to function more efficiently, as well as financial sustainability and competitiveness, explained the commissioner for employment, social affairs and inclusion. They concluded that: ministers for finance have a role to play in the field of competitiveness and that employment and social affairs ministers must get their voice heard better in this debate.
The retirement age was one aspect that raised a number of questions, which the Commission described as “indispensable”. Countries that have still not set a limit on the retirement age will soon have to do so and there are strong arguments in favour of establishing a link between age and life expectancy. The opinions expressed by ministers have shifted towards convergence on this issue, pointed out Andor. Nonetheless, imposing a common age of retirement in the EU is not supported by the Commission. Andor repeated that the Commission did not intend to support the introduction of a common retirement age in the EU because there were different considerations regarding life expectancy in the different member states. The commissioner said that Spain is a good example because the age of retirement was set at 67 years old since it took into account life expectancy and labour market participation. Spain had reached the right conclusion by basing the appropriate legal age of retirement in the appropriate context. This is one thing that each member state has to do separately, asserted Andor.
Ministers also highlighted the differences in the EU between pension systems. The Commission remained neutral on this point because the choice between different pension models is a choice that should be made freely. The commissioner explained: “It is essential to maintain enough space for the private pillar, in which there is a wish to maintain flexibility and sufficient autonomous management, whilst protecting the freedom of choice for workers, so long as the models are compatible when workers move from one member state to another”. He explained that these are key elements affecting the discussion. Consensus was reached in favour of own regulation but what kind of regulation ought to be applied? Andor explained that “the question of Solvability II and the corresponding regime divides the different points of view somewhat, but it is clear that everyone considers that a system that functions better is necessary and that it is more appropriate for the pension systems. This point of view is shared by all.” (G. B./transl.fl)