The European Commission is taking bold steps to address the looming crisis in supplementary pensions. With a shrinking workforce and aging populations, the future of national pensions is at stake. But here’s where it gets controversial: the Commission’s strategy involves liberalizing supplementary pensions and encouraging citizens to invest more of their savings. This initiative, part of the Savings and Investment Union (SIU) strategy, aims to strengthen both the demand and supply of private and occupational pensions. The Commission recommends auto-enrolment, allowing workers to be automatically included in supplementary pension schemes with the freedom to opt out. This approach, according to a draft statement, will increase participation and boost the overall pensions market. Member states will also be encouraged to develop comprehensive pension tracking systems, providing workers with a clearer overview of their pension rights and projected benefits. The proposal also encourages the development of ‘pension dashboards’ for policymakers to better understand the ‘coverage, sustainability, and adequacy’ of multi-pillar pension systems. The Commission intends to amend existing EU legislation on financial institutions to allow for pension schemes to diversify their investments and scale up supplementary pensions. This includes amending the Directive on Institutions for Occupational Retirement Provision (IORP) II, which will enhance the protection of savers and remove barriers to market-driven consolidation. Such measures will reduce costs and allow institutions to diversify their investment portfolios, including in equity, and deliver stronger returns on citizens’ savings. This initiative also contributes to increased financing opportunities for European companies. However, the Commission’s plan to amend the Pan-European Personal Pension Product (PEPP) regulation has faced challenges. The review will introduce an ‘affordable and easily accessible Basic PEPP’ to be invested in simple financial assets and offered to the public without advice. Savers will also have access to ‘tailored’ PEPPs that may include guarantees and more complex assets, requiring advice to ensure consumer understanding. The PEPP will be adaptable to different investor preferences and suitable for various types of providers. Under the SIU Strategy, the EU is trying to encourage more opportunities for households to invest in capital markets as a way of boosting economic growth and competitiveness. While public pension schemes remain the cornerstone of pension systems in member states, the Commission’s initiative focuses on strengthening supplementary pensions without replacing public pensions. Auto-enrolment schemes will encourage people to think about their pensions earlier in their working life, ensuring they don’t miss out on the benefits of starting to save sooner.