Prospects for the pension system

After talks with the officials in Brussels, Bucharest announces a gradual increase of retirement age to 65

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Mihai Pelin, 23.05.2023, 13:50

The retirement age will gradually increase to 65 for all citizens, and no pensions in Romania
will be higher than the corresponding salary, the
labour minister Marius Budăi said. In addition, some of the special allowances
will be scrapped.

These are some of the criteria agreed on
with the European Commission, for the benchmark in the National Recovery and
Resilience Plan to be checked. The criteria discussed last week in Brussels
with respect to the new pension law include, among other things, the gradual
increase of the retirement age and the fact that pension benefits will be
calculated based on the entire contribution period. Previously, a specific
period of employment, with higher salaries, would be selected for calculating
the retirement benefits. Another
principle is the gradual increase in the professional seniority required for
certain categories of employees.

On the other hand, certain privileges for
various professional categories, such as magistrates and parliamentary civil
servants, will be scrapped.

Marius Budăi: Certain categories of allowances and benefits
paid under special laws will be scrapped, and this will be achieved by no
longer allowing for seniority to be considered as a whole, but only in the relevant
position for retirement. This will be the case for magistrates, for instance,
where the requirement will be to have worked for at least 20 years as a
magistrate, instead of the overall seniority. The same goes for certain
categories of civil servants in parliament.

Marius Budăi also said that an impact study
conducted by the World Bank had been submitted to the European Commission ahead
of his visit to Brussels, and that talks were based on that document.

The labour minister did not mention a
deadline for the implementation of these new provisions, but said that
amendments are to be tabled by the ruling coalition this week to the Chamber of
Deputies, which is currently discussing the new pension law.

Up until now, the standard retirement age
in Romania was 63 years for women and 65 for men. Mention should be made that Lithuania,
Romania, and Bulgaria are last placed in Europe in terms of life expectancy,
with around 74 years as against roughly 83 years in Norway, Iceland and Ireland. More than half of the deaths reported
in Romania are related to hazardous health behaviours: Romanians drink lots of
alcohol and smoke too much, have unhealthy eating habits and do not exercise
enough, the report concluded. (AMP)