Pensions, white smoke expected for the Social Security Arbitrator

The time is ripe, and after so many declarations, the time has come to give shape to the long-awaited overhaul of the complementary pension system. The individual measures being discussed as part of the Manoeuvre are not enough; what is needed is an organic reform that has been announced several times by various government representatives and has been worked on for some time.

There are many topics on the table: from the various measures aimed at offering greater margins of manoeuvre to pension funds to invest in the real economy, to the tax benefits hoped for by pension funds, including that of increasing and making more flexible the deductibility threshold for contributions paid by members; from joining with silent consent through life-cycle lines, to incentives to encourage the provision of annuities, without neglecting the need to strengthen the pension culture of Italians. Just to mention a few issues. Among these, however, one should not forget the need to establish a 'pension arbiter'.

For years, Covip has been calling for the protection of pension savings to be strengthened through the creation of an extrajudicial dispute resolution body, as already exists at the Bank of Italy, Consob and Ivass, where the Abf (Banking and Financial Arbitrator), Acf (Arbitrator for Financial Disputes) and Aas (Insurance Arbitrator) are operational respectively. For the Authority in charge of supervising pension funds, the Arbitration would allow members, pensioners and beneficiaries to obtain decisions on disputes quickly, without the costs of legal assistance. And there is a need for it.

A need that is also highlighted by the growing number of complaints addressed to Covip by members of the various pension schemes or other parties, aimed at drawing attention to possible malfunctions of the fund. These reports are important in order to bring to the Authority's attention alleged criticalities, irregularities or anomalies, to give rise to a supervisory activity and to verify, from a general point of view, the actual existence of critical areas in respect of which to take action to correct the malfunctions detected. Covip cannot resolve individual disputes on the merits; it does not have the power to settle disputes between supplementary pension schemes and, still less, pension funds and individual members, pensioners and beneficiaries; nor between members and employers required to pay social security contributions.

In 2024, 508 complaints were received by the Authority, approximately 10 per cent more than in the previous year, of which 36 related to negotiated pension funds, 42 to pre-existing pension funds, 131 to open-ended funds and 299 concerned Individual Pension Plans (IPPs). While complaints forwarded directly to pension funds and not to Covip in 2024 amounted to around 3,800. The Pension Arbitrator - if and when it arrives - will have its work cut out for it.