On September 27, 2017, the first assessment of Pension Reform was conducted, within “ReforMeter”. Based on the Government Survey, 38.8% of the reform is already implemented. At this stage, the reform concept is elaborated and approved by the Government. In October, the draft law will be publicly available. The pension fund functions and obligations are formulated. The regulatory body is defined. Pension system operating rules are designed.
The reform was also evaluated by the reform stakeholders. They underlined that the reform concept was changed many times, and the last version is not still available. Hence, they were not aware of the final concept of the private pension savings (II Pillar) system, as well the indexation mechanisms of social pensions. According to the Ministry of Economy, the draft law on private pension savings will be published the first week of October.
The Trade Union representative underscored the importance of social pensions as a tool for poverty reduction, since access to the saving scheme will not be provided to a large portion of the population, due to the high level of informal employment. They welcome the plan to introduce mechanisms of social pension indexation, and state that it should be linked not only to inflation, but also to other parameters. It is necessary to review the methodology of subsistence minimum and to calculate inflation separately for retired people.
The level of communication between the government and stakeholders is not at the desired level, according to the asset management companies. They expect adequate and timely information on all changes from the reform implementation body. It was also underlined that the existing law and the presented reform concept restricts investment of pension assets in securities issued by its affiliated entity. Such restrictions while undeveloped and small capital market are problem for asset management companies. Instead of prohibiting investment, they propose regulating such investments by setting thresholds and high standards of transparency.
The Stakeholder Group evaluated the Pension Reform with a score of 3.97 out of 10.