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There is no risk of pulling the plug on pension Pillar II, which is still supported by the state, despite being privately managed, Minister of Labor Lia Olguta Vasilescu explained on Friday, in reply to a question as to whether pension Pillar II will be scrapped in the end. Asked if the weight of the individual contribution to Pillar II will still rise so as to reach 6 percent, as provided for 2016, Vasilescu said that this percentage had been established at a time when Pillar II needed resources, but that she believes it's no longer the case to progressively increase it.
Lia Olguta Vasilescu said that this however does not imply lowering the effective contributions and that the reduction of the percentage from 5.1 to 3.75 is the result of the shift of the tax burden as gross wages will rise 20 percent but transfers to Pillar II in nominal terms stay the same next year, specifically at 7 billion lei.
President of Romania's Privately Managed Pensions Association (APAPR) Iulius Postolache said recently that any change in the architecture of the Pillar II pension system will harm the millions of contributors who are supposed to collect a pension under this system. Pension Pillar II has been lately subject to a host of political statements that also included suggestions that it will be dismantled, as well as of its becoming optional.
As of this September, the net assets managed by the funds participating to Pillar II stood at 38.16 billion lei with 7 million contributors and 7 billion lei in net contributions.
