There are many reasons, but they all lead to the same end. Pension plans closed 2011 with fewer contributions than the previous year. The only other time this happened was 2009, although the backslide was merely 0.3% at that time. According to data from Inverco, pension plan contributions slipped 1.7% to 10.63 billion euros, which was 200,000 euros less than in 2010 and suggests that savers could be putting their money in several classes of pension funds.
It is not unexpected that the industry would close the year in the red when taking into account the fact that there are several factors working against it. The biggest is tied to the economic crisis. "We have to understand that there have been modifications to laws detailing how individuals can withdraw capital from their pension plans when facing periods of long-term unemployment and exhausted credit options elsewhere," said Marta Díaz Abajo from Atlas Capital. The Minister of Labor just published a report indicating that 2011 closed with 5.27 jobless workers in Spain, 1.3 million of whom will not receive any form of loan assistance.
Further, Ángel Serrano Montilla, who is responsible for business development at Barclays Spain, said that 50% of the people drawing on their pensions are enduring a period of long-term unemployment.
