The government's proposed reform of the pension system was met with harsh criticism on Thursday, with opposition parties saying that the changes planned represent a radical departure from the very goals of the pension reform - which has been in the works for more than 20 years - and that future retirees would be short-changed.
One of the proposals criticised is the idea to change the regulation on the additional 27 percent payment on top of pensions from the 1st, state-run, pillar – which would only be available to those who opt to transfer their 2nd pillar savings into the 1st pillar fund, i.e. the state budget.
In state broadcaster HRT’s programme on Thursday guests invited to talk about the reform were Labour Minister, Marko Pavic, head of the Independent Croatian Unions (NHS), Kresimir Sever, and Bernard Jakelic from the employers’ association (HUP).
Pavic repeated his assurance that the government aimed to ensure long-term stability of the system.
“Only 20 percent of all pensioners have worked a full 40-year service or more. On average, Croatian pensioners have 30 years of service. The pensions are small and we intend to raise them. The total deficit of the pension system is 17 billion kuna (€2.3 billion) per year,” he said.
Pavic added that the proposal was floated at the working group drafting the bill, and that it is yet to be seen through discussions which way the actual drafting would go.
“The measure we proposed would affect some 300,000 future pensioners. Without a reform, everyone who retires in the next 15 years will receive a pension reduced by about 500 kuna (€68) compared to existing pensioners,” he added, and said that the government is fully aware of the challenge that the pension reform represents, and is willing to accept any good solution to resolve the problem.
VEZANE VIJESTI
Union leader Kresimir Sever said that the wider public will strongly respond to the proposed reform.
“We are re-considering whether we should continue to take part in the working group, or start preparing street protests, or maybe both. Any response from the wider public will be intense. No country has moved so drastically to move the retirement age,” Sever said.
“They want to save money on people’s back. Existing pensioners can’t make ends meet, and future pensioners will have even less. We will also force people into working as long as possible. Our people have shorter life expectancy. We will continue having a life span which is on average 1.6 years shorter than EU average, and now we are going towards extending service years in line with countries where people live five years longer than us,” Sever added.
Bernard Jakelic of the employers’ association said that the pension system is part of the reforms they have been calling for for years.
“We expect that through discussion we will arrive to a compromise solution and devise a satisfactory model. The entire pension system should be transformed and modified in line with the time we are living in,” HRT reported on Friday.
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