How will the Bulgarians retire as of next year? Most probably the freezing of the age and term of service for those, involved in the 3^rd, most widespread labor category, provided by the government in 2014 won’t be repeated. The debates on next year’s budget will show the age and length of service necessary for retirement. Mr. Ivan Neykov, former social minister with the Union of Democratic Forces’ government gives his opinion on the effects that the actions of the governments over the last decade had, regarding the system of retirement. He was part of the government that started the entire reform in the pension model back in 2000 with long-term goals up to 2032. The measures had to melt down the deficit in the National Social Security Institute’s budget, stabilizing the system of insurance. We will also hear the opinion of Mika Zaikova, a Podkrepa trade union expert.

“An erosion of the pension model – that is what has been being done step by step over the past decade,” Ivan Neykov says. Obstacles are being constantly created for its functioning, as the number of early retirees is being increased all the time. This all leads to the final goal – a very serious deficit at NSSI and payment of low pensions for a long time. 13 – 30,000 people will get retired this year within this pension holiday, Mr. Neykov goes on to say. This increases the NSSI expenses and, of course the deficit in its budget of EUR 4.5 bln. We are aware that almost 53 percent of it is due not to social security installments, but to the taxes that we all pay. Furthermore, says Mr. Neykov:

“The more we postpone those radical steps, related with equalization of retirement age for men and women, with linking of life expectancy with retirement age and ceasing of early retirement options, the more comes the moment when maybe 92 and not 52 percent of NSSI’s money will come from taxes. That would be no longer a social security system, but a national system for social benefits. Populism should be stopped as soon as possible, but unfortunately all politicians start to play with this sphere before polls, no matter their expertise. Experts must be heard. The measures are unpopular, but we should realize that the more we postpone them, the heavier the next ones will be.”

“We’ve already done the stupid thing to decrease social security installments. However, those are not a tax burden, but an investment into future,” says Podkrepa expert Mika Zaikova. That is why she sees no problems in the suggestion on 1 percent increasing of social security installments and the unemployment ones. The return of the so-called point system of retirement, gathering length of service and retirement age will solve the problem with the huge unemployment rate.

“We from Podkrepa see two main directions,” Zaykova says. “First, gradual changes – even in Germany they increase retirement age with a month per year, while we are jumping. Second, we should try to restore, if possible, the point system. It solves the imbalance observed. For instance, a person gets 63.8 years old. However, even after reaching 65 he might not have the length of service required. You see what’s going on – fired people, aged over 50, find it hard to get a job, therefore there is a gap in the length of service. That is why I think we should work in these two directions…”

Let’s just remind that as of the beginning of 2012 both the age and length of service requirements for the 3^rd category have started to increase by four months each year. The current government has provided a one-year-long holiday to these people. In order to get retired in 2014, women should be at the age of 60.8, with length of service 34 years and 8 months. These numbers for men are respectively 63.8 and 37.8.

English version: Zhivko Stanchev