Private pension solutions can not solve a public pension crisis

Finance Watch comments on the final agreement of EU legislators on the regulation for a Pan-European Personal Pension Product (PEPP).

Brussels, 14 February 2019 – The European co-legislators have confirmed the final outcome of the interinstitutional negotiations on the regulation for a European private pension product.

For Finance Watch, the final agreement introduces a number of important consumer protection measures, but still leaves unanswered questions over whether the providers of the PEPP will be properly regulated. From an overall perspective, the public interest NGO warns against presenting private pension products as an alternative to properly functioning state and occupation pensions.

Finance Watch’s Secretary General, Benoît Lallemand, welcomed several aspects of the final agreement:

The PEPP introduces the concept of a basic option that is supposed to be appropriate for any saver. This is an important precedent in EU regulation and a step towards addressing issues around the complexity of financial products.

A further positive development has been the inclusion of a cap on costs. Unfortunately, the final agreement was less ambitious than hoped on this point, but still represents a step forward for consumer protection.

He also commented on outstanding safety challenges for the PEPP:

Regulators will have to pay close attention to who is given permission to provide the PEPP and ensure that new authorisation channels do not represent risks for savers.

The further technical work to be done on the proposal should clarify a strong role for EIOPA in providing guidance and oversight for the PEPP to ensure that any citizens investing in these products are properly protected.

However, he raised serious concerns over the overall purpose of the regulation:

Finance Watch has been clear from the start of discussions around the PEPP; it is not the solution to the pension crisis in Europe. Politicians and policymakers need to look for adequate measures to protect European citizens from old-age poverty.

Private pension products should not be presented as an alternative to properly functioning state and occupation pensions. They are a possible investment to supplement, but not to ensure a sufficient level of retirement income.


For further information or interview requests, please contact:

Charlotte Geiger, Senior Communications Officer at Finance Watch, at or at 0032/(0)474331031.


On 13 February 2019, the Council of the EU and European Commission confirmed that a final agreement had been approved for a regulation on a pan-European personal pension product. This is a pillar three, or optional private pension product that consumers can invest in on top of their state and occupational pensions. It also allows savers to potentially continue to invest in the same product if they move to another EU country under certain conditions.

Further Finance Watch publications on pensions:


Finance Watch is a European, not-for-profit association of civil society Members, dedicated to making finance work for the good of society. It works for a financial system that allocates capital to productive use through fair and open markets, in a transparent and sustainable manner, in line with society’s needs and without exploiting or endangering society at large.

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