Campaign for collecting signatures

Applied Economy Group (GEA) intends on collecting 100,000 signatures for the private-pension administrators to grant an annual yield merely equal to inflation rate, as the measure is deemed necessary in the current economic downturn, said the executive director of GEA, Liviu Voinea (photo).

”We are bound to contribute to mandatory pension tier, but we have no guarantee on the minimum return. The current financial crisis is increasing concerns on financial security of population. In the mandatory private pension system (tier II), we risk a miserable annuity”, Voinea explained.

The association of Applied Economy Group, together with Cartel Alfa and National Unionist Block announced the delivery of Phare 2006 project “Who and how is taking care of our pension funds?”

Voinea explained that three reports of CSSPP’s activity monitoring will be made under this project, eight regional seminars will be organized, following to be collected 100,000 signatures for the novation of the mandatory private pension laws, aiming to introducing the minimum guaranteed return equal to inflation rate.

“We will launch this signature-collection campaign in early March, and we intend on collecting 100,000 signatures with the help of the two trade-union associations”, he added.

Voinea pointed out that the monitoring reports would be made based on a set of international performance indicators.

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APAPR: Unrealistic and incompatible proposal

Regarding the proposals on guaranteeing yields above inflation rate within mandatory private pension (tier II) system, the Association for Privately-Managed Pensions in Romania says the proposal is not in compliance with Romanian legislation and with the principles of pension reform, as well as with Romanian tier II system.

“There is in no other state with a similar private pension system with the one in Romania that obliges pension administrators to grant yields above inflation”, said the chairman of APAPR, Crinu Adanut, adding that in Central and Eastern Europe, there are 11 states with similar private pension systems with the one in Romania, “where pension administrators are not bound by law to guarantee yields above inflation, whereas all markets managed this performance (case studies Poland and Hungary)”, said APAPR.

According to the association, the Romanian mandatory private pension system already confers two solid guarantees, of which one is missing from the regional practice. Actually, no Romanian will receive a pension smaller than the amount of savings he had made in the system.

According to APAPR, securing inflation is technically impossible, as there is no financial instrument in the local market good enough to outperform inflation – not even the Romanian state is conferring this guarantee through the securities it issues.

This measure would have only negative effects, clearly in disadvantage of participants, with the Romanian Parliament understanding these arguments and overruling the law draft that contained this proposal.