The pension strategy in Poland is undergoing many changes, and 1 of the most crucial topics that rise controversy is the issue of retirement age. ZUS president Zbigniew Derdziuk, in a conversation with “Fakt” points out that lowering the retirement age was a mistake. However, retirement age policies are now dependent on politicians who are reluctant to address the issue. What arguments are cited by the president of ZUS and what can his proposals mean for the future of pensions in Poland?
Reduction of retirement age: Decision under scrutiny
“The retirement age was wrongly reduced,” says ZUS president Zbigniew Derdziuk. He argues that earlier raising the retirement age was a step in the right direction, given the expanding lives of Poles and the request to rise more funds for retirement. The current decision to reduce the retirement age, although politically popular, according to Derdziuk leads to financial problems and inadequate pension benefits in the future.
In Poland, women can now quit at 60 and men at 65. Derdziuk indicates that a female who retires at the age of 60 may live on average 22 years. At that time, if she worked from the age of 23, she accumulated comparatively small contributions, leading to low pension benefits.
The controversial proposal of ZUS: Termination of contracts
One of the more controversial ideas Derdziuk proposed is to cancel contract contracts for all Poles. He argues that specified a decision would let public education on the pension strategy and increase the savings of future pensioners. "It is crucial that people should be aware of how the strategy works and save money," says Derdziuk.
However, this proposal is very emotional. Critics point out that mandatory procurement contracts would be another financial burden for workers and employers. In the current system, contributions to the Social safety Office are allocated to cover current liabilities, which in practice means that additional charges can be seen as a compulsory ‘harbour’ to the Social safety Office.
Are Poles aware of their future pension security?
Derdziuk points out a deficiency of public awareness of the low level of pension savings. According to him, Poles do not always realize that early retirement and a shorter contribution period translate into lower benefits. "It must be made clear to people that they should work longer, even if there is no administrative coercion", the president of the Social safety Office stressed.
The U.S. Information Policy seeks to educate citizens, but many people inactive do not realize the pension system. There are besides no real incentives for longer work that could increase contributions and improve the pension situation of future generations.
Discussion on raising retirement age: Is she inevitable?
The Minister of Funds, Katarzyna Pełczyńska-Nałęcz, late suggested that a discussion was needed on the re-upping of the retirement age. Derdziuk admits that erstwhile the retirement age is reduced, it can be politically hard to reverse this decision. Nevertheless, it stresses the request to talk about this, arguing that we live longer, and that the current pension strategy is incapable to supply adequate benefits for the future.
"The discussion on extending the retirement age is needed to make us aware that we live longer," says ZUS president. In his opinion, this debate should focus not only on the financial benefits for the state, but besides on the benefits for pensioners themselves who could number on higher benefits after a longer period of work.
Summary
The future of the Polish pension strategy is the subject of a heated debate in which both politicians and experts specified as ZUS president Zbigniew Derdziuk play a key role. The simplification in retirement age, the nullification of contract contracts and the request to extend working life are just any of the controversial topics that are emotional in society.
Although Derdziuk stresses that the current solutions are insufficient, the future of the pension strategy depends mostly on political decisions, as well as whether Poles will be decently informed and prepared for the challenges of demographic and economical change.
Continued here:
President ZUS makes a scandalous proposal to Poles
