The pension system today in all respects resembles a stage where political parties are competing to propose changes to the law first, which all together leads to the additional collapse of the already well-organized social system, it was stated in the joint statement of the Association of Pensioners of Montenegro - For a Life Worthy of Man, the Movement of Pensioners and local associations of Maslina, Gornja Gorica, Ljubović, Gorica and Jedinstva.
They say that the reform of the pension system of Montenegro has been announced, even though it was "communicated in rather vague contours, one could even say shyly", a very important issue that applies both to current pensioners and to employees who are yet to become pensioners, which is why have decided to announce themselves with the best of intentions.
"Back in 2020, we learned that the World Bank was engaged in the reform of the pension and disability insurance system, with the fact that the then Minister of Finance, today's Prime Minister, Mr. Spajić, announced certain positive developments already in June 2021. However, for what reasons we do not know, The World Bank has withdrawn from Montenegro, and the pension system today looks like a stage where political parties are competing to propose changes to the law first, which all together leads to the additional collapse of the already well-organized social system not only pensioners, but all citizens and employers of Montenegro. The then government intervened in the form of the thirty-fourth amendment to the PIO Fund, only to admit in its own statement in October last year, after several warnings from our Association of Pensioners on the "non-adjusted "law", and the solution was found in an extraordinary adjustment. At the same time, Monstat continued to continuously "feed" the PIO Fund with data on the average earnings otherwise collected on the basis of the number of companies included, and other aspects that relate to the size of the company, activity, etc., cannot be considered representative in any way. The Administration of Tax Revenues, otherwise as the only one authorized to communicate accurate data based on financial statements, contributed to the continuously incorrectly determined pension adjustment rates by its inaction. Furthermore, the Tax Administration, although it was foreseen in the work program of Monstat for the year 2023, has not yet started to submit data on the earnings of employees, so that according to all the dates prescribed by law when the adjustment of pensions was carried out in previous years, the pensioners were deprived", stated is in the announcement.
These associations state that numerous factors affect the stability and sustainability of pension systems, as well as that, in general, life expectancy is increasing in all countries of the world, which directly has negative consequences for the financial stability of the pension system.
"On the other hand, the unfavorable relationship between the number of insured persons and pensioners has a direct negative impact on the financial stability of pension systems, given that the growth rate of pensioners is more pronounced in relation to the growth rate of newly employed people, so that Montenegro is not an exception in this sense. Hence, thanks to the above-mentioned situation, today Montenegro is pressed by numerous failures in the functioning of the PIO Fund in the past two decades. which would finally stop the road and eliminate its numerous shortcomings. Undoubtedly, a number of open questions will be on the table of the reformers, but what further complicates the whole matter this time are announcements such as the PIO Fund will be abolished, that the employees will be paid earnings in the gross amount, so they themselves will have to decide which part of the earnings they will set aside for old days and the like. Hence, when it comes to current beneficiaries of pensions in Montenegro, their already low standard of living should not be further reduced. As for the employees now, that is. future pensioners, it is necessary to provide them with a significantly higher replacement rate, i.e. of the ratio of the amount of pension - earnings at the time of retirement, compared to the current rather low level, with the fact that the newly offered solutions must not represent an additional burden for employers. In this sense, we see a key problem in the way pensions are financed, in force in Montenegro, which is predominantly based on the so-called to the principle of intergenerational solidarity, also referred to as funded or current PAYG (pay-as-you-go) can hardly be found in any other country today as the only and exclusive way of financing pensions. Simply speaking, the so-called pension funds established in such systems are not funds, but represent only a kind of transitory account, which is periodically filled by collecting funds from contributions and regularly emptied due to the payment of pensions, which is the case with the Montenegrin system," the statement said.
Conceptualizing a stable and efficient system of pension and disability insurance, as they state, concerns not only those citizens of Montenegro who enjoy pension rights today, but also all those who will become so in the next twenty or fifty years, as well as those who will in that period, insured persons should regularly pay contributions to the pension fund based on the principles of intergenerational solidarity.
"In this sense, in our opinion, on the basis of comparative experiences, the Government should identify interest groups whose opinions will be carefully listened to and agreed upon during the public discussion phase, set clear goals and objectives, and make the effects of the reform visible, measurable and time-limited We highlight this starting from the numerous doubts and misunderstandings caused these days, up to the level of apprehension caused by certain statements of government officials, which amount to indications that there could be a "cancellation" of the PIO Fund, a reduction in contributions and the like , the choice regarding the necessity of starting the reform of the pension system in Montenegro is not "yes" or "no", but there is an undeniable realization on the stage that it is high time to undertake radical reform measures, that their impact on the dignity and material security of citizens is of essential importance and in terms of ensuring the stable future of the state itself, which could finally mark the beginning of compliance with the Statute and the Law on the Functioning of the PIO Fund. and a comprehensive process that requires the active involvement of all relevant interest groups, thus already in its initial phase the general social consensus is imposed as one of the key preconditions for its successful implementation. At the same time, the starting goal is to restore confidence in the pension system, achieve its long-term sustainability and ensure an adequate level of income for citizens in later life. As it is to be expected that this reform will also be a long-term and partly painful process that in the short term usually brings an increase in pension expenditures and thereby creating additional pressure on the public finance system, regardless of their patience, pensioners will have to come to terms with it that it is difficult to achieve significant effects in the short term," stated the statement of these pensioner organizations.
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