BUCHAREST - Romania’s state pension system needs a complete overhaul focused on contributions and private funds to become sustainable, Finance Minister Florin Citu said in an interview with Reuters on Tuesday.
The liberal government is grappling with a massive 40% increase in state pensions from September 2020, introduced by its center-left predecessor, that will bust EU budget limits and risk credit downgrades by ratings agencies. Romania’s seven private pension funds now manage assets worth just under 13 billion euros and are the largest institutional investors on the bourse.
Citu’s government, which came to power in November, will undo those requirements via emergency decree later this week, and he said he would propose raising contributions to 5% in 2021 and 6% in 2022. Facing an election next year, the centrist government has said it will enforce existing legislation, but that it will pare state spending and boost tax collection to stop deficits ballooning.
Exclusive: Every country’s pension system needs complete overhaul
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LMAO! I guess, there is not enough money! But where all the pension system's money is going to! For sure, we need to set up a EU Pension System!