European Association of Paritarian Institutions of social protection

1. AEIP European Association of Paritarian Institutions of social protection

2. AEIP: who we are AEIP is a lobbying organization, aimed at influencing the European Union’s Institutions in their policy and law making process AEIP is therefore based in the core of the European Union’s quarter in Brussels AEIP is a not profit organization (Association) and it represents, through its members (paritarian institutions of social protection) about 75 million Europeans and 1.300 billion € of assets

3. AEIP: who we represent AEIP represents –and is made up of- those institutions of social protection which are jointly set up and managed by the social partners (paritarian institutions): Pension institutions managing statutory schemes ”1 pillar”; Pension funds (supplementary to the State pensions “2 pillar”); Healthcare institutions (providing healthcare benefits) Unemployment institutions (benefits for the unemployed) Paid holiday institutions (covering the pay during holidays) Health and safety at work institutions (providing trainings, etc.)

4. A paritarian institution: MANAGEMENT BOARD Equal(parity in) numberofemployers’ and unionsrepresentatives from “parity”- “Paritarian” ) Collective agreement setting up the social institution (and pension plan) Employers Associations Trade Unions Employers Employees

5. Members (2011)

6. Working groups of AEIP Commissions • Commission I – Coordinated Retirement Schemes (1st pillar pensions) • Commission II – Pension Funds (2nd pillar pensions) • Commission III – Health and Provident Funds • Commission IV – Paid Holidays schemes • Commission V – Health and Safety at Work Task Forces More and more at industry wide level • Task Force “Construction” (Collecting the Pension funds of the construction personnel sector) • Task Force “Health and Care” (Collecting the Pensions and social funds of the healthcare personnel sector) • Task Force Metalworkers (Collecting the Pension funds of the metalworkers sector) • Task Force Food and Agriculture sector: in a close future • Task Force “Solvency” (Facing the Solvency Rules matters of P.F.) • Territorial and Regional pension and other social funds (about the local/regional social funds set up by social partners) Other Working Groups • Scientific Council

7. Participation of AEIP to the working groups of works of the EU Consultation of the Commission in the field of the simplification of the 883/04 (former 1408/71) Participation in the Pension Forum of the European Commission Member of the Consultative Panel of EIOPA in Frankfurt

8. Our current cooperation:

9. According to us (1/3): • A mixed system–made up of PAYG and Funded • elements- seem to be preferable (diversification of • the risks of Demographic Dependency Ratio on the • one hand; and Financial Turmoil on the other hand). • So multi-pillar, or multi-layer system would be • better, if well organized(but with a second pillar • very different than some adopted in the 1990s in • Central and Eastern Europe)

10. According to us (2/3): • Sector-wide or companies’ occupational pensions, • set up through collective barganing agreements, • and managed together by representatives of • employees and employers • represent the BEST MODEL OF GOVERNANCE • (equal representation of the parties involved, more • reliability towards the members of the pension • scheme and non-for profit goals): paritarian model

11. According to us (3/3): • Those occupational pensions, • 3) Would be more efficient if compulsory for all the workers and the employers of their sector • They should be collective funds (not based on individual accounts) in order to provide solidarity among their members • They should be non-business oriented, and they should be in great part exempted by EU competition/market rules

12. The importance of solidarity in a collective (mandatory) pension fund • As it is based on collective accounts, non-contributory periods are covered by the fund itself • Mandatory participation into the same (non profit) fund: • Eradicates all the costs of advertising; • Being big, the management fees are very reduced • Allows long term investments granting major returns and being less vulnerable on the crisis times • 3) In a period of crisis, all the participants (and even the pensioners) can share the sacrifices, by relieving major burdens for everyone

13. Es. administrative cost per participant in a bigger fund

14. Es. Cost of pension funds vs Life Insurers(Research of the Dutch Central Bank)

15. Current pension issues of primary concern for us (1/2) • The current initiatives for a NEW framework for the pensions in Europe (the 20 initiatives listed in the White Paper on pensions of the European Commission) • The questions concerning the legal competence on pensions between EU and Members States • Ongoing initiatives on Governance, Solvency and Supervision of pension funds carried out by the EU

16. Current pension issues of primary concern for us (2/2) • - The sustainability and adequacy of pensions in Europe (retirement age; labor market reforms; shift from DB to other formulas) • Mobility of workers within the EU as for the acquisition and safeguard of their pension rights (coordination of different pension systems, cross border pensions, portability of social rights, etc.) • Promotion of cross-border pensions plans’ initiatives at Company level or at industry-wide level managed by the Social Partners

17. Transatlantic cooperation Protocols of Cooperation

18. Next Annual Transatlantic Conference (you are all welcome!) Building for the Future: Tackling Together the Global Challenges of Social Protection Paris, 27-28 June 2012

19. THANK YOU FOR YOUR ATTENTION! • Francesco Briganti • Director of the AEIP • Francesco.briganti@aeip.net • info@aeip.net