The Pension Reform Commission should debate the promotion of saving for old age

Update: 02.09.2022 00:51

Prague – The Pension Reform Commission could today continue the debate on the support of voluntary savings for old age, which it started before the summer holidays. She could possibly also start discussing changes in the public pension system, or in the first pillar, into which contributions flow and from which pensions are paid.

The pension advisory team was established by Minister of Labor Marian Jurečka (KDU-ČSL) at the beginning of April. The commission, which consists of representatives of coalition parties, ministries of labor and finance, and economists, has met three times so far. In addition to proposals to support savings, she discussed the reduction of contributions for part-time workers or motivational tools to work at retirement age.

The Ministry of Labor said on its website after the latest meeting that the role of private retirement savings as a source of income in retirement will grow in the coming decades, people should save more and withdraw money saved in regular installments as a pension, not in a lump sum. State support for savings in the so-called third pillar could change, and the Ministry of Finance is also preparing long-term investment accounts with tax benefits, the Ministry of Labor announced.

According to Deputy Minister of Labor for Social Insurance and Benefits Ivy Merhautová (KDU-ČSL), there is a consensus that voluntary savings for old age need to be strengthened and made more efficient. Adviser to the Minister of Finance Lenka Kohoutová (ODS) emphasized that the changes must be sustainable in the future and the savings parameters should be set so that as many people as possible save for their old age and even self-employed people get more involved. The politicians did not want to describe the proposed proposals in more detail.

Fial’s cabinet promises in its program statement that it will present a “real pension reform” by the end of 2023. The basic part of the pension, which now corresponds to ten percent of the average wage, should be increased according to the financial possibilities of the state. The merit part should be based on contributions and the number of raised children. A state or public fund to save for old age should be created, and private pension savings should be supported. According to Merhautová, the commission is gradually dealing with plans from the government program and should now also focus on changes in the first pension pillar. Next, it will be about solidarity and merit and “their new setting”, said the deputy. Minister of Labor Marian Jurečka (KDU-ČSL) repeated several times that raising children should be enough for parents to ensure a decent pension, and childless people should save more for their old age.

Pension expenses increase every year. The pension system tends to be in a slight surplus only in boom years, falling into deficits when it cools down. During the past crisis, annual deficits exceeded 50 billion crowns in some years. Experts have been pointing out for a long time that without changes the pension system is not sustainable in the future. In the last two election periods, the governments of the time did not implement reform measures during the period of economic growth.

Source: České noviny – hlavní události by

*The article has been translated based on the content of České noviny – hlavní události by If there is any problem regarding the content, copyright, please leave a report below the article. We will try to process as quickly as possible to protect the rights of the author. Thank you very much!

*We just want readers to access information more quickly and easily with other multilingual content, instead of information only available in a certain language.

*We always respect the copyright of the content of the author and always include the original link of the source article.If the author disagrees, just leave the report below the article, the article will be edited or deleted at the request of the author. Thanks very much! Best regards!