The European Commission (EC) should rethink its Solvency II plans in light of the recent results published by the European Insurance and Occupational Pensions Authority (EIOPA) as they “lack credibility” according to Punter Southall head of research Jane Beverley.

Beverley argued that the results have been taken from only 99 individual pension schemes or Institutions for Occupational Retirement Provision (IORPs) when there are an estimated 140,000 IORPs within the whole of the EU.

In addition she stated that the IORPs who provided data tended to be the largest schemes, and she accentuated that “it may therefore not represent true experience across all scheme sizes.” She added that the Pensions Regulator “provided aggregate figures for all UK IORPs, but even here the results were only benchmarked against 21 of the largest UK schemes out of a total of 6,432 schemes.”

Concerning calculations it has been argued that further work is needed on the methodology for valuing sponsors support.

Beverley stated: “There is also an issue of timing. EIOPA indicates that it will not be able to publish final results until the end of June this year, which does not fit well with the EC’s plans to introduce a revised IORP directive earlier that month.

“Introducing a solvency regime to pensions across the whole of Europe is not a decision that should be taken in a hurry or on inadequate data. I therefore believe that the QIS results should at the least lead the EC to reconsider its proposed timetable, but also should lead them to question whether the policy should be abandoned altogether, especially given the growing chorus of opposition from the UK, Netherlands, Germany, Ireland and now Belgium.”

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