earnings - related public pension schemes past contributions or earnings are rescaled to adjust to changes in living standards between the time pension rights accrued and the time they are claimed. this valorisation of past earnings is mostly done in line with economy - wide wage growth or with labour productivity increase. france now rescales according to price growth only. such an approach would considerably decrease the implicit liabilities of the pension system in luxembourg. finland, portugal and poland rescale according to a mix of wage and price growth with evolving benefits. d ) indexation of pensions price indexation protects purchasing power ; wage indexation protects living standards. is a pensioner entitled to benefit from productivity gains in which he did not participate? the traditional life cycle consumption pattern assumes that old age people consume less or differently by increasing health care consumption. since health care is largely socialized or subsidized, productivity increases should benefit more wage income than pension income. this is all the more so as the labour force diminishes and the dependency ratio increases. in response one can argue that the increase in life expectancy also influences the consumption behaviour of old age. this is already reflected in private banking wealth management profiles. looking at the number of countries that have moved away from indexation of pensions to future wages the answer seems to be that political and financial sustainability do not seem to be mutually exclusive. but only piecemeal moves are observed in this area. some adjust to a mix of wage growth and price inflation and change the weighting. in italy, higher pensions are increased by less than price inflation. portugal also gives larger increases to smaller pensions. austria introduced a cap on price inflation adjustment. in belgium price indexation is linked to a trimmed down index excluding volatile elements such as oil products, alcohol or tobacco. in luxembourg, we do not only fully index wages but also pensions. we share this situation with slovenia. conclusion a year ago, at a conference on structural reforms at the central bank of luxembourg, governor garganas said that “ addressing the challenges for greece ’ s fiscal position and international competitiveness will require, first and foremost, sustained further progress towards fiscal consolidation, including measures to put the public pension system on a sound basis. ” these words have to be seen in the light of the epc report that shows for greece a below eu average evolving labour productivity rate and one of the strongest declines in labour supply. there is a clear trend towards a reduced pension promise, as shown as a consequence

the second half of 2024, and will be finalised for the 2026 srep cycle. the srep reform will enable us to be more efficient, more comprehensive, and more effective – and will enhance our communication with banks. allow me to elaborate further on my point by taking climate and nature - related risks as an example. the eu legislator did not invent climate risk or the burden of ensuring an orderly transition. the risk has been around for a long time. the intergovernmental panel on climate change ( ipcc ) was created in 1988 to provide scientific assessments and recommendations related to the current state of knowledge about climate change. the paris agreement was adopted in 2015 at the un climate change conference cop212 after the fifth assessment report of the ipcc. so clearly, all the facts have been on the table for decades. the latest tragedy in spain has shown that the financial cost can severely hit the economy, not just at the regional but also at the national level. and we have many other recent examples showing the macro - financial relevance of climate and nature - related risks. on the one hand, the cost of the transition will be high. on the other hand, analysis consistently confirms that the costs of doing too little too late are much higher. the ecb supervisory stress test in 2022 confirmed this analysis for the banking sector. the reinsurance sector, which is exposed to natural catastrophes more routinely than the banking sector, has clearly understood this and shown that, without rapid adaptation, insurance could become unaffordable in some regions. regrettably, the prevailing consensus in climate science tells us that we are far from on track to meet the goal of limiting global heating to two degrees celsius, as set out in the paris agreement. diluting regulation, supervisory intensity and effectiveness will do nothing to change the scale and magnitude of these risks, either in the very near future or in the medium and long term. instead, we need to renew our efforts and banks 2 / 4 bis - central bankers'speeches need to demonstrate their ability to correctly assess and properly manage these risks – risks which will undoubtedly have a negative impact on their profitability and resilience. digitalisation is another important factor that will drive bank profitability in the future. and once again, the facts leave no room for doubt. customers expect the same from their banks as they do from any other business : they want to be able to easily access all of the services associated with their bank account