Another reform is being proposed in Croatia.
Živi Zid president Ivan Vilibor Sinčić and his coalition partner, Ivan Lovrinović, the president of the Let’s Change Croatia party, presented on Sunday their pension reform plan.
Lovrinović pointed out that for years, about 50 percent of pensions have been paid with borrowed funds. He said that instability of the system was due to the large number of veterans who were retired after the end of the Homeland War, as well as the large number of workers retired during the privatization process. Their coalition wants to reduce administrative costs in the pension system. A few years ago, said Lovrinović, about 3,000 people worked in the administration of the pension system, and today the number has increased to 5,000. “We see that the administration is slowly destroying the pension system. Of the total funds for pensions, about 3.5 percent is used for system administration”, said Lovrinović, adding that in other developed countries just one percent of funds was used for such purposes.
Lovrinović also said that they planned to save about 850 million kuna which were currently being spent on the lease of office space for various government departments, agencies and institutions. They would be moved to premises owned by the state. The initiative could be implemented within a year, and 850 million kuna would be directed into the pension system. Lovrinović would save additional 900 million kuna which the state spends on a variety of consulting and intellectual services. He believes such services could be performed by employees already working in the public administration system.
He also said there was about 17 billion kuna in one of the accounts of the Croatian National Bank which could also be used and partly redirected into the pension system. He said that it was a retained profit of the Bank since its establishment.
Sinčić said that many pensioners – about 72 percent of them who receive pensions lower than 1,750 kuna – could not afford a decent life. He added they their coalition would achieve a great result at the elections and reiterated that they were the only real option. He said that MOST was not sincere and that Zagreb Mayor Milan Bandić’s coalition was not worthy of comment. As for HDZ and SDP, Sinčić said they already had their chance. “Among the strongest political options, we are the only ones who remain. Even if we do not win power, we will accelerate social and economic changes in the country”, concluded Sinčić.