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Contributions on Romania's mandatory pension market should reach 6% of the gross salary in 4 years

Raising contributions on the mandatory pension market (Pillar II), which was canceled this year owing to the economic crisis, has to be resumed faster after the economy recovers so it reaches 6 percent of the gross salary in 4 years instead of 8, said the head of market watchdog CSSPP Mircea Oancea.

The government decided to postpone increasing contribution from 2 to 2.5 percent of the gross salary this year. According to the initial plan, the threshold had to advance by 0.5 percentage points each year in the next eight years, until it reaches 6 percent.

Oancea declared the Romanian mandatory pension market is less developed than that of other countries. Assets on Pillar II represented 0.003 percent of the gross domestic product (GDP) in 2007, versus 0.2 percent of the GDP last year.

In 2007, the mandatory private pension market ran assets representing 4.8 percent of the GDP in The Czech Republic, 7.7 percent of the GDP in Croatia, 11.1 percent in Hungary and 11.9 percent in Poland.

Participating on Pillar II is mandatory for those aged below 35 and optional for those aged between 35 and 45.

The Romanian pension system was reformed in May 2007. Apart from the traditionally state-collected pensions (Pillar I) and the optional private ones (Pillar III), a new type appeared, the mandatory pensions privately managed (Pillar II).

 

Sursa: http://www.newsin.ro/

Tags: mandatory percent years pillar gross pension market salary