The European Commission is working to convince member states to adopt "automatic adjustments" in their pension legislations so that the retirement age is pegged to longevity, reads an internal document obtained by EURACTIV.
Three commissioners are actively involved in shaping EU policy on pensions with the intention of encouraging reform and influencing decisions taken by member states.
László Andor, the EU commissioner for employment and social affairs, Michel Barnier, in charge of the internal market, and Olli Rehn, responsible for economic affairs, are holding regular meetings to better define the EU executive's action in the field of pensions.
In their last meeting on 9 February, they discussed "how the Commission can ensure that member states follow up on questions such as increasing the retirement age, linking it to life expectancy [and] reducing early retirement schemes," according to the meeting document obtained by EURACTIV.
The Commission plans to hold an "orientation debate" on demography during the first meeting of the College in March. The debate "may have implications on the Commission's pension policy," reads the document.
After having collected positions from relevant stakeholders for its Green Paper on pensions, the Commission's next move will be to publish a White Paper in the third quarter of 2011, which will define more clearly the EU executive's objectives regarding pension reform.
EU leaders meeting for a summit at the end of March are also likely to address the pension issue in relation to Franco-German proposals for a 'Competitiveness Pact', which considers "adapting pension systems to demographic developments".
However, Brussels is moving only cautiously on this contentious issue. Although there is wide consensus on the need for reform, not all member states are convinced that automatic adjustments are the way forward. Public opposition to reform in this direction is also widespread.
Parliament split over automatic adjustments
The divisive nature of this issue was confirmed yesterday (16 February) by a resolution adopted by the European Parliament, which omitted references to automatic adjustments.
The Socialists & Democrats (S&D) and leftist (GUE/NGL) groups are opposed to the idea of raising the retirement age and believe that automatic adjustments are unnecessary.
The original text, drafted by Dutch EPP MEP Ria Oomen-Ruijten, had stated that the Parliament "observes that life expectancy is growing and calls on member states to consider linking the statutory retirement age to life expectancy".
Despite support for this view by the influential EPP and liberal ALDE groups, the sentence had to scrapped from the final text.
For the leftists, other means could be used to collect the funding necessary to make pensions sustainable in the longer term, for instance new taxes, especially on the financial sector.
The S&D group, for its part, is not convinced that life expectancy will actually rise in the coming years and argues this will depend on a number of unpredictable factors, perhaps related to living conditions and access to health care, which are not the same for all citizens.
MEPs also discussed less divisive issues, such as the portability of pensions for citizens who have spent their working lives in several EU countries.
The resolution also stressed MEPs' concern over "the inadequate information provided to the public by public authorities and bodies administering pensions concerning the necessity, possibilities, accumulated entitlements, likely results and actual state of affairs with regard to old-age pensions".
Indeed, obtaining relevant information on pension entitlements often proves a difficult task in many EU countries.