EIOPA submits its advice on pensions tools to EC

The European Insurance and Occupational Pensions Authority (EIOPA) has submitted its advice on pension tools to the European Commission (EC).

The advice covers two tools – the pension tracking system and the pensions dashboard. The first, aims to help citizens understand what income they can expect in their retirement and raise their awareness on whether this will be sufficient.

Currently, there are 20 member states where citizens are unable to obtain an overview of their pension entitlements in an accessible way from all possible pension sources. EIOPA’s advice to the EC provides a set of principles, good practices and recommendations, aiming to facilitate citizens’ digital access to personal pension information in those member states.

As part of this, EIOPA has also developed a visual roadmap that contains four phases from preparation to launch, including relevant conceptual and practical steps to consider under each phase. In respect of product design, EIOPA recommends displaying key information in a simple manner to make a pension tracking system appealing and understandable for consumers. Member states are also encouraged to connect to the European Tracking Service to offer intra-EU mobile workers access to their pensions entitlements accrued in the course of their career.

Regarding the pensions dashboard, the aim is to increase transparency on adequacy and sustainability gaps to support policy makers at national and EU level to make informed decisions.

“EIOPA advises to develop a visual pension dashboard to strengthen the monitoring of pension developments in the member states by presenting a complete set of indicators that allow for enhanced analysis and comparison and are also easy to comprehend. In particular, EIOPA recommends using indicators drawn from the European Commission’s triennial ageing, pension adequacy and fiscal sustainability reports. These indicators need to be complemented with key information on the contribution of privately provided occupational and personal pensions,” EIOPA stated.

Furthermore, EIOPA recommends that additional pensions data are collected from private pension providers, including non-pension fund providers.

The regulator has identified substantial data gaps with key data only being available for half of the supplementary pension plans and products offered in the EU. Therefore, EIOPA believes that resolving these data gaps is essential to enable member states to make pensions projection and design suitable policy responses coping with future pressure on public finances or poverty of the senior population. A step-by-step approach is recommended in the implementation by using currently available pensions data and enhancing the indicators over time.

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