25/10/2011
By Adam Cadle
Current compensation measures in the French pension system need to be simplified if inequalities in the level of funds between pension schemes are to be avoided according to the Conseil d’Orientation des Retraites (COR).
The French compensation system in France, which represented €8.1bn in 2009, consists of two separate pillars and aims to eradicate any financial imbalances of some pension schemes, whose performances have been affected by economic changes, by ensuring that a constant transfer of capital is integrated within the system. The first pillar involves the transfer of capital between employee pension schemes and the second deals with transfers between schemes representing employees and non employees.
The complexity of the transfer system to resolve the imbalances between schemes has been criticised by the COR, with it calling for the two pillars of the French pension compensation system to be incorporated into one unit to help align calculation methods.
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