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Steve Webb builds Euro coalition to oppose Solvency II for pensions

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Pensions minister Steve Webb is attempting to build a coalition of European countries to oppose plans to impose Solvency II-style funding requirements on defined-benefit pension schemes.

A European Commission green paper, published in July last year, aimed to launch a public debate on how to ensure “adequate, sustainable and safe” pensions across the EU.

The proposals in the paper include an increase in capital requirements and possible pan-European regulation of pension funds.

The Confederation of British Industry has previously branded the plans a “terrible idea” and warned they could lead to an £800bn equity sell-off as pension funds look to buy less risky assets.

Speaking at the NAPF trustee conference in London yesterday, Webb (pictured) said: “We are all in favour of solvent pension funds but trying to impose a standard design for insurance on DB pensions does not fit and would be extremely damaging for the UK.

“We have a small number of European allies on this, so we will be working with other European countries to try to build a coalition to stop the imposition of Solvency II on pension funds.”

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  1. One wonders how Solvency II will impact on unfunded public sector DB schemes. It could be very awkward indeed, making them even more monumentally expensive (not to mention unsustainable) than they are already. No wonder Mr Webb hopes to garner support for some sort of opt-out.

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