A senior European asset manager has called on the European Commission to set up a 'Europension' as a supplementary tier to national provision which would facilitate free movement of labour within the single market. A failure to do so could lead to in-creased unemployment.

Pointing to the Chilean reforms and the US 401k system, Pieter Korteweg, president and CEO of the Robeco Group said: Both offer tax credits in respect of individual pension schemes and allow a wide range of capital-creating products for building up the pension.

"In Europe we need something similar. Only individual schemes permit the employee to take their pension rights with them."

Korteweg, who was speaking at an investment funds awards ceremony in Brussels, accepted that it would be impossible to bring about an interchangable system between the EU's pension systems, hence the need for individual supplementary schemes.

He pointed out that in most countries the development of individual pensions is still in its infancy, making development at European level relatively easy.

Korteweg set out three pre-conditions for success: that the new pension should be established by a generic not a specific directive, that fiscal regulations must not restrict mobility and that there be a 'level playing field' among capital accumulation products.

On the latter point, he added: "In-surance products, individual stocks, bonds and investment funds should be able to participate on equal terms. The client must be able to choose the product that best suits his needs."

To back the case for reform, Korteweg suggested that a failure to devel-op a single market for pensions would lead to unemployment as EU countries' freedom to devalue or go overbudget was restricted by EMU and the stability pact. "There can be no question of an unimpeded flow of labour while pension rights cannot be taken along from the old job to the new.

"With the advent of the euro, the smooth functioning of the European labour market is becoming a crucial matter. The urge and pressure of 'best practice' requires a labour market that functions efficiently. If it does not unemployment will increase.""

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