BCR Pensions is currently the sole administrator of a new product line – occupational pensions, also known as “Pillar 4 pensions”, said Radu Crăciun, Chairman and CEO, BCR Pensions and President of the Romanian Association of Privately Administered Pensions (APAPR), at the Energy Strategy Summit 2022, an event organized by Energynomics.
“It is a product that is primarily targeted at certain sectors, including the energy sector. In the energy area we have large employers who are very well qualified for this subject,” he said.
Occupational pensions are aimed at medium and large companies that want to provide a generous contribution to their employees.
“Being a dedicated pension fund, it is also an image vector. The fund must have a credible and interesting value to be an image vector in the market. In the case of Pillar 3, the company name does not appear in the fund name, which is not the case here, where the fund is named after the company. A major difference with Pillar 3 is that this product has a ‘vesting’ component – in the first three years the money is not the employee’s but the employer’s. The fund thus becomes a retention element, because if the employee does not stay in the fund for at least that period, he loses that money. It’s a way for employers to ensure that employees stay with them for a minimum period. Here, again, size matters. Because if I have a very small contribution, the employee doesn’t lose very much if they leave.”
Another important element, the voluntary pension scheme has a well-established commission, while in this case the commission is negotiated. In addition, only one commission is paid in Pillar 4, compared to 2 commissions in Pillar 3. The money is received when retirement from the public system takes place, unlike in P3, where it is taken at age 60+.
“Communication for P4 can be done through internal company communication campaigns. P4 offers more balanced benefits to both employees and employers. P4 is customizable to the interest of employers, it has the retention component that P3 does not, but employees also take advantage of this benefit, which is an advantage in retirement,” he added.
Energy Strategy Summit 2022 was organized by Energynomics with the support of its partners: ABB, BCR, CE Oltenia, Chimcomplex, Eaton, Electrica Furnizare, Electroalfa, EnergoBit, Enevo Group, European Energy, Eximbank, EY, Franklin Templeton, Horváth, ING, Hidroelectrica, Marsh, MET Energy România, Nuclearelectrica, BCR Pensii, Photomate, Powertis, Renomia Gallagher, Schneider Electric, Transelectrica, Volt, wpd.