EU-wide pension plan takes shape

New plans for an EU pension could make saving for retirement more straightforward for people who move from one member state to another during their careers – but it is not yet clear whether the scheme will be open to Britons following Brexit.

New plans for a European Union (EU) pension could make saving for retirement more straightforward for people who move from one member state to another during their careers but it is not yet clear whether the scheme will be open to Britons following Brexit.

Proposals published last week by the European Commission (EC) pave the way for the launch of a stripped-down and low-cost private pension, the pan-European pension product (Pepp), which would be portable across all the member states. In part, the proposal aims to address Europe's savings gap. While it is concerning that 14% of adults in the UK have no private pension savings at all, the position across Europe as a whole is far worse: just 27% of EU citizens have private savings, according to the European Insurance and Occupational Pensions Authority. However, the EC also sees Pepps as another step towards its long-standing ambition for a capital markets union, with harmonisation of the EU's financial markets due to be completed by 2019.

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David Prosser
Business Columnist

David Prosser is a regular MoneyWeek columnist, writing on small business and entrepreneurship, as well as pensions and other forms of tax-efficient savings and investments. David has been a financial journalist for almost 30 years, specialising initially in personal finance, and then in broader business coverage. He has worked for national newspaper groups including The Financial Times, The Guardian and Observer, Express Newspapers and, most recently, The Independent, where he served for more than three years as business editor.