The effort to address this situation was prompted by the growing number of pensioners, many of whom have chosen, over the past few years, to receive less money, in the form of early retirement benefits, but to have a secure source of income. Moreover, before the crisis broke out, some of those who had resorted to early retirement would find jobs and combine the pension benefits with the salary.
In order to deter such practices, early retirement benefits will be now by 45 per cent smaller than the regular pension, instead of the 30 per cent reduction in place so far. That happens because Romania, which still struggles with the effects of the economic crisis and with a number of pensioners by one-quarter larger than its work able population, is facing growing difficulties trying to meet its pension financing needs. But authorities warn that part of the problem has to do with those who receive “outrageously large” pension benefits. The media has uncovered cases of people who took advantage of loopholes in the legislation in order to secure pension incomes that are even higher than the salaries received as employees.
100 to 1 is the ratio between the largest and smaller pension paid in Romania. “Regular, medium-value pensions will not be reduced further to recalculation; only the special pensions, amounting to thousands of Euros, and which are not correlated with the amount contributed to the budget, will be slashed,” Prime Minister Emil Boc explains. According to him, there are around 180,000 to 200,000 special pension cases in Romania, only 15 per cent of which will be substantially reduced further to the recalculation procedure. The Prime Minister says this measure alone would entail savings of 500 to 800 million Euros.
We are yet to see whether this correction clashes with the principle that no law may be enforced retroactively. Meanwhile, considerable effort will also be put into re-analysing the files of all pensioners having retired for health-related reasons. Labour Minister Mihai Seitan estimates that close to 30 per cent of all disability pensions have been granted without adequate justification, and the number of disability pensioners has grown from 600 thousand in 2001 to 900 thousand in 2010. Under these circumstances, 300 thousand people may be deprived of this undue source of income, and may be forced to start looking for jobs, until they reach full retirement age, which in turn will be gradually increased to 65 years. The new pension system is set to take effect starting January 2011.
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2025-04-03
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