On March 4th, the Bill to Promote Employment Pension Plans was published in the Official Bulletin of the Cortes, which currently covers just under two million workers, with a notable stagnation in this area for many years. The reasons for such limited coverage, and for the relatively small amount of managed assets—significantly lower than in other European countries—are likely multiple: a lack of development in collective bargaining, large segments of workers with low wages, insufficient tax incentives, or the high coverage rate of the public pension system.
But whatever the reasons explaining the underdevelopment of employment pension plans, this government initiative to promote them decisively should be received by all as good news and an opportunity.
The Bill, in a smart way, entrusts the promotion and development of pension plans to sectoral collective bargaining, which can promote them through specific agreements or collective agreements. Due to their binding nature, these agreements can impose mandatory enrollment in the pension plan for the companies included within their functional and territorial scope. The initiative is also open to agreements in the public sector and those that could be promoted by associations of self-employed workers, professional corporations, trade unions, or social security mutuals.
Especially in private employment pension plans of a sectoral nature—those undoubtedly called to play a leading role—their development requires a real commitment from collective negotiators, unions, and business organizations. This commitment should be based on the conviction that the development of these employment plans does not weaken the public pension system nor the wage structure, but rather complements and improves the former, making the latter more dynamic and flexible in its contents and evolution, depending on the changing circumstances of the economic cycle. For businesses, promoting employment pension plans in sectoral negotiations should not be seen as a new cost to labor but rather as a way to make labor more efficient, especially in situations like the present, where price increases are pushing up wages. Part of those wages would reasonably be allocated to establishing long-term savings, which is beneficial for the economy as a whole and, therefore, for strengthening the business fabric.
It is true that there is some reluctance or pessimism among trade unions and business organizations regarding the success of the development of these sectoral pension plans. However, it would be a mistake not to take advantage of this path that has opened up. It would help limit pressure on the public system, without meaning to weaken its foundations, but rather the opposite. It would also enrich collective bargaining, which cannot remain on the sidelines of the most important agreements regulating and developing such a relevant institution as social security in the business sphere. The absence of social interlocutors in the development of social security can only contribute to its attempt to develop outside their involvement, likely with worse results and in a more unjust manner, as social security may end up being developed only for workers with higher wages, as has already happened in some cases.
It is true, of course, that the Bill can be improved during the parliamentary process, and it is unanimous that it should have a much better fiscal treatment than the very stingy and insufficient one proposed, also in this case with a too short-sighted perspective from the tax authorities. But it would be unforgivable if this attempt, the most serious made in three decades to promote the development of employment pension plans, were to fail due to the inaction of social agents, pulling us away from the best practices established by our European partners.
