New pan-European pension fund to boost researcher mobility:
Mobility of researchers in Europe received a boost today with the launch of a consortium that aims to establish a new pan-European pension arrangement. Once put in place, the RESAVER initiative would mean that researchers could move freely without having to worry about preserving their supplementary pension benefits.
The consortium plans to set up the pension arrangement in 2015. It will enable researchers to remain affiliated to the same pension fund, even when changing jobs and moving between different countries. The European Commission will cover the initial set up costs through a four-year framework contract that will be awarded before the end of 2014.
The consortium will be working as an international not-for-profit association registered in Belgium. The founding members are: Central European University Budapest; Central European Research Infrastructure Consortium (CERIC-ERIC); Elettra - Sincrotrone Trieste S.C.p.A; Fondazione Edmund Mach; Istituto Italiano di Tecnologia; Technical University of Vienna; and the Association of universities in the Netherlands (VSNU).
European Commissioner for Research, Innovation and Science Máire Geoghegan-Quinn said: "We have worked hard to boost the free movement of knowledge in Europe. Our €80 billion research and innovation programme Horizon 2020 was built with this in mind. Pensions are a serious barrier to free movement, but today that barrier has begun to crumble. I strongly encourage research organisations across Europe to join the consortium."
By participating in RESAVER, employers will be able to sponsor one single pension arrangement. It will be a highly flexible retirement savings product that corresponds to the specific needs of the research community, and is capable of delivering:
- cross-border pooling of pension plans;
- continuity of the accumulation of pension benefits as professionals move between different organisations and countries during their career;
- lower overhead costs (and therefore improved member benefits) through economies of scale;
I thank Theodore Economou, CEO and CIO of the CERN Pension, for bringing this new pan-European pension fund to my attention.
The fund will help get closer to the European Research Area (ERA), a true 'single market for research'. The second ERA Progress Report, published on 16 September 2014 (IP/14/1003), confirmed that researcher mobility has serious benefits. For example, the research impact of researchers who have moved between countries is nearly 20% higher than those who have not. They generate more knowledge, which in turn means bigger benefits to the economy.
- a pan-European risk pooling solution.
Mobility of researchers is a driver of excellence in research. Nevertheless, researchers currently face many difficulties in preserving their supplementary pension benefits when moving between different countries. To overcome this problem, the European Commission conducted a feasibility study in 2010 on a Pan-European pension arrangement for researchers. Following the feasibility study, the Commission's Directorate-General for Research and Innovation invited a group of interested employers and employer representatives to prepare the ground for the establishment of what has become known as “Retirement Savings Vehicle for European Research Institutions” or RESAVER.
The initiative was singled out as a priority in the 2012 Communication on ERA, in which the European Commission committed itself to "support stakeholders in setting up pan-European supplementary pension fund(s) for researchers".
Theodore sent me his comments along with the press release:
This is actually quite big news in the European pension landscape. For the first time, there is a perspective that a worker moving from one EU country to another could actually stay in the same pension plan. Something considered normal in the US or Canada when moving from one state/province to another, could become a reality in Europe (albeit this particular pension plan would be limited to a certain group of employers, in order to comply with practice in several European countries where pension arrangements are organized by trade).Well, I can't think of a better person to lead such a task force. Theodore is an exceptionally bright pension fund manager who runs the CERN Pension like a global macro fund.
Note that I’m obviously biased because for the past two years, I was the secretary of the task force that developed a proposal for the establishment of this pension fund.
I welcome this new initiative as it bolsters my case for enhancing the Canada Pension Plan (CPP) for all Canadians. As I recently stated in my comment on the brutal truth on DC plans:
In my ideal world, you won't have the bcIMC, Caisse, OTPP, PSP, AIMCo, HOOPP or Bombardier, CN, Bell, Air Canada pension plans. You will only have large, well-governed public defined-benefit plans managing the assets and liabilities of all Canadians regardless of whether they work in the public or private sector. If we achieve such a monumental undertaking, we will significantly lower investment and administrative costs and do away with the issue of pension portability once and for all because people will move across public and private sector jobs knowing their pensions are safe and secure, backed by the full faith and credit of the federal government.I stand by those comments and that's why I think this new pan-European pension fund is a very smart initiative. The only thing that worries me is the Euro deflation crisis and whether it will spread to the United States. For now, global stock markets are not worried, bouncing back vigorously from the latest selloff, but this could change and the future of the eurozone remains very fragile.
Below, I end with Prime Minister Stephen Harper's address to the nation following the attack on Parliament Hill in Ottawa where Nathan Cirrilo, a member of the Canadian Forces, was shot dead. Prime Minister Harper also addressed the House of Commons this morning in a remarkable and personal speech which ended by him thanking Kevin Vickers, Canada's Sergeant-at-Arms who shot the perpetrator dead, and by him embracing the two leaders of the opposition (watch clip below).
My thoughts and prayers go out to Cpl. Nathan Cirillo's family. The world is not a safe place but Mr. Harper and the leaders of the opposition are right, Canadians will never be intimidated and we will move on.