Following the decision to delay pension age and the OFE reform, the situation of the Social Security Fund (FUS) is improving. However, there is some trouble to be seen on the horizon. In 25 years we will have to deal with yet another debate on the pension system. After 2040, further increases in the pension age or a complete overhaul of the system may prove necessary.
Such are the conclusions of the debate on the long-term stability of the first pillar of FUS held at the offices of Employers of Poland. Participants wondered whether in light of upcoming dynamic demographic changes a quicker increase of the pension age and a new valorization formula might be needed.
– According to European Commission documents, the inversion of the pension reform of 1999 would provide a short-term relief for the budget, but will not solve the problem and will be quite risky in a long-term perspective – says Piotr Kamiński, Vicepresident of Employers of Poland.
He points out that during elections pension issues are frequently brought up – usually in the context of promises to ease the system.
– Politicians find such declarations easy to make, but the problem is that they have to be financed in some way – he adds.
Paweł Wojciechowski, Chief Economist of ZUS and former Minister of Finance also admits that the pension system cannot be separated from public finances, and a long-term balancing of the FUS is not possible with the current systemic premises. He confirms that data indicate that serious problems may appear as early as in 25 years.
ZUS analyses clearly show that if the system is not corrected, increasing the pension age to 67 after 2040 may prove insufficient.
– As of now this is the optimum solution, but perhaps we will have to consider whether increasing pension age quicker would not be necessary as the society continues to age – says Marek Bucior, Viceminister of Labour and Social Policy and is quick to stress that in this regard a lot depends on public opinion.
Aleksandra Wiktorow, the Polish Insurance Ombudsman and former Viceminister of Labour responsible for the 1999 pension system reform, also believes that a discussion on quicker pension age increase is not necessary yet and that the current formula for valorization has to be improved.
– Sadly, the risk of system failure is still real. In this context the question is often of what is just when it should rather be a question of what is feasible, as these two issues are sometimes completely different. At the end of the day, higher contributions are a burden for entrepreneurs – stresses Monika Gładoch, Adviser to the President of Employers of Poland.
Łukasz Kozłowski. Expert of Employers of Poland remarks that mathematics are merciless If in the next few years the pension system and in turn public finances are to maintain balance either pensions have to significantly lower or a further two-step pension age increase will be necessary.
The general conclusion is that if the budget is to remain stable, we have to be ready to work until old age and receive rather modest pensions when we retire. The worst thing of all is that rational discussion on pensions has no place in politics.
The debate was organized within the framework of the “Establishment of the Research and Analysis Center” project, Human Capital Operational Program, Sub-activity 5.5.2.