Filenews 22 February 2026 - by Theano Thiopoulou
The young people of today and, essentially, the pensioners of tomorrow will be faced with significant changes, as the way is opened for new pension plans. Public pension systems continue to be the backbone of pensions in the Member States, but the pressure on their sustainability is increasing.
Overall, the trend in Europe is towards a more funded model (where pensions are based on invested capital) to ensure the sustainability of the systems, with a focus on strengthening private savings through supplementary pensions. European officials, regulators and market participants see supplementary pensions, in the context of the Savings and Investments Union (SIU), as a crucial reform to address an ageing population and strengthen the competitiveness of the European economy.
The Ecofin meeting, a few days ago, once again highlighted the aspect of the Savings and Investment Union and opened the chapter of the structural reforms that will define the European economy of the next decade. In particular, the Occupational Pension Funds Directive and the revision of the Regulation on a pan-European personal pension product were discussed. The central topic of the discussion was supplementary pensions, with the aim of strengthening them as a complementary axis of public pension systems and ensuring adequate income during retirement. At the forefront is the revision of the Occupational Pension Funds Directive, as part of the broader package discussed in ECOFIN and part of the Savings and Investment Union.
Changes are being promoted
The supplementary pension sector remains underdeveloped in many Member States. According to EIOPA (European Insurance and Occupational Pensions Authority), only 20% of Europeans participate in occupational pension schemes and only 18% have a personal pension product. This leaves a large part of the population exposed to the risk of a significant reduction in their income after retirement. The aim is to channel more long-term savings into productive investments, to strengthen the participation of workers and professionals in collective pension schemes and to support the financing of the European economy.
The Savings and Investments Union is the number one policy issue discussed across Europe in recent months and Cyprus, as shown by the statements of the Minister of Finance Makis Keravnos, supports the initiative, which will help citizens secure a more adequate income in retirement, through improved access to stronger and more efficient supplementary pension systems.
The Cyprus Presidency supports
The aim of the Cyprus Presidency is to channel private capital into the real economy through supplementary pensions. Mr. Keravnos defined the strengthening of supplementary pensions as a move with a dual character, social and developmental. He stressed that improving access to effective supplementary systems aims to ensure a more adequate income for citizens, acting as a complement and not a substitute for public pensions. At the same time, he underlined that this reform is crucial for European competitiveness, as it seeks to channel funds from pension funds into the real economy, enhancing productivity and the EU's strategic priorities.
The logic is to give everyone the opportunity to use their savings safely, based on their needs and goals. Younger people can take more risk with a long horizon, older people can invest more conservatively, while everyone will be able to adjust their choices. Citizens will enjoy higher returns over time and European businesses will have better access to equity, with a healthier financing structure. It is a cycle that benefits citizens, businesses and the European economy.
They don't save for retirement
It is important to mention that the Federation of European Insurance Associations conducted a pan-European public opinion survey, in which 12,700 citizens from 12 European countries participated. The survey shows that, despite the growing recognition of the importance of saving, four out of ten Europeans still do not save for their retirement. Despite growing awareness of the need to save, 41% of Europeans still do not contribute to supplementary pension schemes, with rates per country ranging from 16% to 65%.
Security remains the main priority for European savers: 81% prefer products that guarantee at least their capital. Only 19% of participants prefer higher risk for higher returns. Pensions remain the preferred form of payment (43%), but there is also interest in lump sum or combined solutions.
In favour of Cyprus, Greece and the European Commissioner for Economy
The President of the Council of Ministers of Finance (ECOFIN), Makis Keravnos, and the Commissioner for Economy, Valdis Dombrovskis, gave a clear signal in favour of strengthening investments through the mobilization of private savings, placing the negotiation on supplementary pensions in the broader context of the Savings and Investments Union (SIU). The Minister pointed out that the Union of Savings and Investments is decisive for the release of forces and the channelling of money into productive investments.
Mr. Keravnos highlighted the social and developmental nature of the supplementary pension package, noting that "the ultimate goal of the supplementary pension package is to help citizens secure a more adequate income in retirement, through improving access to stronger and more effective supplementary pension systems." At the same time, he underlined the role of pension funds in the real economy.
For his part, Commissioner Dombrovskis confirmed that supplementary pensions are a key pillar of the SIU strategy. "Our goal is to strengthen both the supply and demand of supplementary pension products to help citizens ensure adequate income in retirement," he noted.
In the same vein, Greek Minister of National Economy and Finance Kyriakos Pierrakakis stressed that the Savings and Investments Union is the number one policy issue that has been discussed throughout Europe in recent months, adding that "if it is achieved, it will be the biggest political victory of a generation", pointing out, however, that it is a particularly complex project, difficult to communicate widely, due to the technical nature of the issues that make it up.
