The Association of Romanian Financial Service Users (AURSF) was not sought for consultation by the Financial Supervisory Authority (ASF) or anyone else before the draft law on the drawdown of mandatory private pensions was put up for public debate, and the oversight authority rejected all of AURSF's proposals made during the public consultation, the Association's president Alin Iacob stated in a post on LinkedIn.
"The private pension drawdown bill developed by ASF targets all categories of private pensions (Pillars 2, 3 and 4), with no difference in treatment. The average pension account for uninterrupted contribution since the operationalization of Pillar 2 is approximately RON 50,000, and not below RON 20,000, as ASF representatives implied at the end of last week by taking into account the several million occasional or part-time contributors. The amounts in the participants' accounts will continue to grow substantially in the coming years, given that there are at least 12 years left in the accumulation phase, and now the percentages and incomes are (much) higher than in the early years of the system, and we hope that the returns offered by pension fund managers will also hover into significant real-terms positive territory," said Alin Iacob.
He went on to note that information available to AURSF shows that the European trend is to offer pension savers several options and to allow them to withdraw their funds in full (UK, France, Belgium), and voiced his belief that this must also be the direction for the national law to follow.
"We welcome the assurances provided by private pension fund managers that they will have no issues with payments, not even at the peak of disbursements, in 15 years. Considering that the healthy life expectancy after retirement does not much exceed 5 years in Romania (as per Eurostat, OECD, Statista 2022 data), we consider that doubling the minimum drawdown period for the private pension from 5 to 10 years is untimely. We are here for the ASF and all other stakeholders to continue the discussions, preferably in a transparent manner, in the presence of the media, as we have requested since June," Alin Iacob also wrote.
The draft law on the drawdown of private pensions, which was unveiled on Friday in a first reading at the government meeting, provides for two forms of payment: the programmed withdrawal pension, which will be paid over a determined period, with the guarantee of the full reimbursement of the accumulated asset, and the life pension, with payments throughout the participant's life. In addition to these two forms of payment, the pensioner's right to withdraw a lump sum of up to 25% of the accumulated asset is also provided for, in a form similar to those applied in other European countries.
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