Today, the Coalition Government set out its response to the European Commission’s Green Paper “towards adequate, sustainable and safe European pension systems”, welcoming it as a timely contribution to the debate on the challenges of an ageing society.
Minister for Pensions Steve Webb said:
It is important that we have a considered, wide ranging and open discussion about how to ensure pensions are secure and affordable, and encourage individuals to save for their retirement. However we don’t believe that there is a “one size fits all” model for pension systems across the EU.
We fully support creating a robust and sustainable single market for insurance, but we don’t believe the new capital solvency requirements should be applied to occupational pensions.
The Green Paper asked if a new solvency regime for defined benefit pensions should be introduced. However, in the UK the employer’s covenant already places a legal obligation on employers to pay into pension schemes, this is enforced by the Pensions Regulator and the Pension Protection Fund offers protection in the event of an employer becoming insolvent.
The Government, through its programme of pensions reforms, is already tackling many of the issues raised in the consultation.