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The third meeting of the SEE Network of Economic and Legal Experts

8 September 2010: The trade union legal and economic experts from the trade unions in Serbia (SSSS, UGS Nezavisnost), Croatia (SSSH, NHS, and HUS), Macedonia (SSM and KSS), Montenegro (SSCG), and Bosnia and Herzegovina (KSBiH) participated in the meeting organised in the framework of the LO-Norway financed project “Contribution of trade unions to the reforms of pension systems”.

They briefly presented their pension systems in their respective countries, the reforms contacted so far, as well as positions of trade unions related to reforms, that is, the opinion of trade unions on adequacy and sustainability of pension systems.

Mr. Martin Hutsebaut – EU expert and tutor in the Project presented the Strategy and priorities of EU 2020, as well as priorities for the modernization of pension policies in Europe: adequacy of pensions, sustainability, mobility, and transparency.

The guests in the meeting were: Ms. Dženana Pavlinović – Olof Palme International Center for BiH, and Mr. Patrik Bergvall – LO TCO.

National presentations:

Serbia: The Proposal of the Law and Pension Insurance is in the procedure, and the discussion on the law will be held in October 2010. The adoption of the law is expected to take place by the end of year 2010, while the law will come into force on 1 January 2011. The IMF and stand-by arrangement have a big impact on the terms of the law, given that IMF is asking the Government of Serbia to significantly cut the public expenditure by the year 2015. Trade union positions and demands related to this proposed law are: (1) Government of Serbia has to secure the prerequisites – to implement the employment strategy; (2) it is needed that the social partners equally participate in the reform; (3) it is important to secure the functional system of control of collection of contributions, given that the current – carried through the tax administration – is inefficient; (4) the management structure of the Pension fund should accommodate the representatives of those who contribute to this Fund; (5) reform cannot result in the fall of living standard, that is, the pensions should satisfy the minimum of human needs; (6) reform should result in a sustainable system. The Round table in Serbia is urgent.

Croatia: Government is working on amendments to the Law on pension insurance, and these are the eleventh amendments to the law. In April 201, the trade unions had their round table, together with experts, and the basic requirements of the trade unions were: economic acceptability and sustainability of the system. There are still many other dilemmas, but the trade unions insist on: (1) trade unions will not allow changes in the pension system without prior consultations with social partners and minimal consensus achieved; (2) the independent experts should provide analysis of good and bad sides of reform so far; (3) transparency is required, and it can also be achieved that the private capitalized saving fall under the public administration and management; (4) the political culture should be changed and the culture of dialog should be developed. As the result of current events, the round table in Croatia is urgent.

Montenegro: There are three pillars in the Montenegrin Law, but only the first pillar is functioning, and as of 2008, the third pillar is partly functioning. The Swiss model of pension calculation is applied. Trade union should have their place in the Management Board of the Pension Fund. At this time, trade unions do not have nay major concerns, and the round table is not really deemed necessary, unless some important changes take place.

Macedonia: Reforms commenced in 2003. First and second pillar are mandatory, and the third voluntary pillar is “a pillar for the rich” according to the trade unions. The trade unions do not have their place in the Management Boards in any of the three pillars. The Economic and Social Council was recently established, and it is expected that it begins with its functioning and that the social partners will be able to discuss many issues. The trade union basic requirements are: (1) a provision should be inserted in the law which would define the terms of retirement /early retirement/, not only one as it is the case now /age/ (2) trade unions should have their place in the Management Boards of the Funds; (3) the costs of maintenance of the pension fund should be discussed, given that they are too big.

BiH: This matter is at the entity level. The strategy on the reform of pension system is drafted in the FBiH, and it foresees 3 pillars. Given that the elections are ahead of us, the matter of pension reform is put aside. In May 2010, RS adopted the strategy of pension system reform, which also provided for 3 pillars. The unemployment is huge in both entities, informal economy is vivid, collection of contributions for the Funds is insufficient, and the system of control of collection of contributions is ineffective.

Following the short national presentations, the participants raised common concerns of all trade unions in the region:

-  World Bank is dictating all the reforms – this is a new pension orthodoxy and neoliberal logic
-  The campaign that “pay as you go” system as unsustainable
-  Employment should be increased
-  The production and economic growth should be stimulated
-  The grey economy should be reduced

/Enisa Salimovic

this article has been tagged

Work Plan , Newsletter , South-East Europe , Economic reforms , Pension system reform
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