"It is widely acknowledged how urgent it is to put in practice comprehensive strategies and policies to adapt pension systems, recognising that in order to maximise the possibility to deliver adequate, safe and sustainable pensions, there is a role for a combination of public and private regimes.
Our analysis revealed that taxation, social law, as well as difficulties in the area of harmonisation of contract law, appear to be the most significant hurdles to develop a truly single market for personal pensions. In particular these could result in obstacles to economies of scale and the achievement of critical mass.
We also need to consider consumer awareness on their projected income after retirement. If we want citizens to have a responsible attitude towards pensions we need to ensure that they have sufficient information about their individual pension situation resulting from the different pension systems in which they are engaged, starting from the 1st pillar.
We believe a strong case is made for a future EU Directive that would establish a single market for personal pensions inter alia through the alignment across the EU of personal pension holder protection measures, capturing also any personal pension providers that are not currently regulated at EU level.
Regarding the establishment of a second regime for EU personal pensions, further work needs to be done to clearly identify the costs and benefits. If a second regime will be developed, it should focus on defined contribution products with an appropriate level of standardisation. As always there is a trade-off between product standardisation and product innovation. Nevertheless, a higher level of standardisation will help in achieving the required critical mass to decrease costs and facilitate the consolidation of multi-pillar systems in many countries. Standardisation will also help in delivering simpler products, with transparent fee structures, avoid conflicts of interest in selling practices and provide ultimately 'good value for money' for consumers."
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