A small and concentrated sector in the Ibex 35: this is how the pension plans are with which the State will compete
If the government manages to maintain its plans, it will start the public employment pension fund next summer. This commitment of the Minister of Social Security, José Luis Escrivá, seeks to promote in Spain these savings plans in which the employer and the worker contribute to a fund that, at the time of retirement, will be a complement to public pensions. Although with decades of history –they came into operation at the end of the eighties–, this savings channel barely covers 1.9 million workers in Spain and, in practice, this coverage remains mainly for the employees of the largest companies in the world. country and with little implementation in SMEs and the self-employed.
At the end of the third quarter of the year, the employment pension funds - known as the second pillar of the pension system - operating in Spain managed 37,109 million euros of assets, according to the statistics of the collective investment employer, Inverco. To compare it, there are almost 87,000 million that are in individual plans - third pillar - those in which a person decides to create a private piggy bank without being linked to their work. There are more than a thousand plans linked to the company, a system that is usually agreed in collective bargaining as an added benefit for the worker.
However, the aforementioned statistics show that, despite the multiple plans and funds that exist in Spain, the bulk of the assets they manage comes from a small number of companies. Specifically, only five of them add up to about 17,000 million euros, almost half of the total. They are the ones who manage the savings associated with the workers of CaixaBank, Endesa, Telefónica, BBVA and Bankia. Other large companies on the Ibex 35 complete the list of the largest plans, such as Banco Santander, Iberdrola, Repsol or Naturgy.
Pensions Caixa 30, the fund that brings together CaixaBank employees, is the largest of those operating in Spain, since it has some 46,000 participants and manages assets of around 6,700 million euros. In other words, around one out of every six euros that in Spain is in employment pension funds is in this plan of the Catalan entity. The next largest by size, far from that of CaixaBank, is that of Endesa's employees, which totals around 3,130 million euros. The plan for Telefónica workers amounts to slightly less than 3,000 million, that of BBVA includes about 2,500 million euros and that of Bankia, whose workers have already joined CaixaBank, adds another 1,800 million. Santander's pension fund also has more than 1,000 million euros of assets. Therefore, the existence of a few funds that manage most of the assets shows that there are hundreds of them of small size, which in this sector is usually accompanied by higher costs.
The concentration can be seen not only in which workers are covered by these plans, but also in who manages them. The five main entities account for 84% of the assets that are found among occupational pension plans. CaixaBank, which is the entity with the highest interests in the different levels of pension plan management, accumulates a market share of 34%. They are followed by BBVA, which has just over 22%; Ibercaja, with 12%; Fonditel - Telefónica manager that mainly includes the employment plans of its workers and other investment vehicles -, with 10%; and Banco Santander, with just over 6%.
The draft bill that Escrivá presented two weeks ago aims to develop this saving alternative and is one of the Government's commitments in the Recovery Plan and which was also included in the General Budgets of last year. The minister has avoided setting specific objectives regarding the number of participants or the assets managed, although in the past he has stated that he would like around half of Spanish workers to be attached to business plans, taking the case of the case of Euskadi, where these funds already have a significant penetration.
As Escrivá has expressed in his public appearances and appears in the bill, the objective is not so much to offer the public fund to the staff of large companies but to encourage SMEs or freelancers to join an alternative that, today , it is not conducive to them. "The reduced average dimension [...] it is an element that affects their efficiency in terms of management costs and, ultimately, their profitability. Hence, an essential objective of this law is to promote the existence of employment pension funds with adequate size to guarantee lower management costs, allow a diversified distribution of investments and, with this, improve profitability levels ", reads the preamble of the norm, which is currently under public consultation before the Council of Ministers gives its final approval and sends it to the Cortes.
Escrivá has made no secret that the objective of the fund is to be large enough to have lower costs and, therefore, be more attractive to small companies and employed persons. Although the fund is publicly driven, the management will be private and the Government requires as a condition for participation that the commission applied is less than 0.3% of the assets under management. The Executive justifies this decision in that the current employment plans with public workers with 100 million under management have commissions lower than that figure "and the public promotion employment funds aspire to have figures much higher than said assets."
The private sector in which the public impulse will now enter has recognized in recent weeks that the second pillar needs more development in Spain. However, they deny that state participation is necessary. In fact, they consider that if it has not been developed further until now, it has nothing to do with supply but with the lack of tax incentives for companies to offer this product to their workers. "I honestly do not believe that the lack of development of the second pillar has to do with management," pointed out Pilar González de Frutos, president of Unespa, the employer's association for insurance companies in Spain, at a recent meeting of the financial sector.
The rejection among representatives of insurance companies, funds and banks is notorious. The CEOE even crossed out the proposal of "unfair competition" and opened the door to bring him to justice. However, the main point of discontent that the sector maintains publicly is that the measure to create a public employment pension fund is accompanied by a cut in tax benefits for those who decide to have individual plans - third pillar of the pension system. So what they have gone from 8,000 euros per year of contribution in 2020 to 1,500 euros for next year. Despite the rejection shown by the employers, there are already large insurers, such as Mapfre, which have shown their interest in entering the contest to manage the public fund.
