20/02/03

The ABI (Association of British Insurers) is writing to members of the European Parliament, calling on them to reject amendments to the Occupational Pensions Directive that threaten the UK’s tax-free lump sum.  This follows a vote yesterday in the European Parliament’s Economic and Monetary Affairs Committee.

Speaking at an ABI seminar on European Pensions, Stephen Sklaroff, Deputy Director General of the ABI said, “The ABI supports the principles of the Occupational Pensions Directive which would ensure flexibility, security and consumer protection, and preserve the existing national pension systems. 

“On the face of it, the Parliament’s new amendments endanger the tax-free lump sum, which is an important part of the UK pensions system and a significant benefit to UK savers.  We are concerned that this change could seriously disadvantage savers at a time when we need to encourage people to save more for their retirement, not only in the UK but in all 15 Member States.  We believe that the focus of this debate should be on practical solutions that will benefit all savers.”

The Occupational Pensions Directive is designed to allow workers of multi national companies to have access to cross border occupational pension schemes.  It will establish the prudential rules for such pension schemes.  The European Parliament is due to have the second reading of the directive on March 13 and if it is adopted, it will become part of UK law in 2005.

Provided By the ABI