Edited by Frans Pennings and Gijsbert Vonk
Chapter 15: A European pensions union: Towards a strengthening of the European pension systems
Due to the ageing of the European population, over the years much thought has been given at European level to the sustainability (in particular affordability) of the pension system on the one hand, and to the flexibility of the labour market on the other, with pensions forming part of terms of employment. In this regard the sustainability and financial structure of pension systems cannot be viewed independently from the stability of the European financial system and the economy as such. The most recent financial and economic crisis resulted in, among other things, a significant strengthening of European financial supervision within the European Union and now, in the eurozone, initial steps towards developing a banking union and the introduction of a separate Treaty on Stability, Coordination and Governance in the EMU (the Fiscal Compact), which sets out rules for national budgets of the signatory EU Member States. Legislation on, for example, European insurance funds (the Solvency II Directive) and investment funds (the amendments to the UCITS Directive) have seen further harmonisation at European level. In addition, in the European labour market, pension schemes in cross-border situations are often beset with practical problems regarding the relationship between various tax and social laws and regulations.
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