After a heated debate, the parliament on Friday passed a set of six bills for the comprehensive pension reform.

The bills were adopted without lawmakers from the opposition Most party.

“We won’t take part in this shameful trade where former SDP MPs are saving this government, and the key partners, MP Milorad Pupovac of the SDSS and Darinko Dumbovic (Reformists), are not present,” Most MP Nikola Grmoja said as the party’s MPs walked out of parliament.

The voting continued, without Social Democratic Party MPs voting either. The majority required to adopt the laws was secured by SDP MPs who had defected to the HNS caucus and to Zagreb mayor Milan Bandic’s Work and Solidarity party – MP Mario Habek, MP Milanka Opacic and MP Zdravko Ronko.

The reform, which comes into force as of January 1, 2019, foresees extending working life to 67 years of age as of 2033, penalising early retirement with 0.3 percent reduction in pension for each month of early retirement, or 18 percent for five years, as well as allowing pensioners to continue working part-time for 4 hours a day and retaining their pensions.

Until now, Croatian pensioners would lose their pensions if they engaged in paid work.

Beneficiaries of the second pillar pension system will be given the option to choose which pillar to take their pension from, the first, state-run pillar, or the second pillar, which is based on capitalised pension savings managed by private pension funds.

If they choose to receive their pension only from the first pillar, they will receive the 27 percent sension payment for the period until 2002, and 20,25 percent for later payments or for receiving pension from both pillars.

In 2007, the government had introduced an additional payment financed from the state budget, paid to Croatians who receive pensions from the first pillar. In 2010, the payment was set at 27 percent on top of the state-paid pension.

Some changes were made to the reform between the first and second readings in parliament, so the penalty for early retirement was reduced from the originally planned 0.34 percent to 0.3 percent.

The reform also brings changes to pension funds aimed at providing greater transparency and control.

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