Pension fund faces annual shortfall of around 1 billion euros, Velkovski guarantees pension payments

To make pension payments, the state pension fund faces an annual shortfall of around one billion euros. Social Policy Minister Gjoko Velkovski confirmed in an interview with “360 Degrees” on MRT 1 that this funding gap is covered with money from the state budget.

Around 2.4 billion euros a year is needed for pensions, while approximately 1.4 billion euros is collected from employee contributions. According to Velkovski, the state currently provides around 60 billion denars annually to cover the pension fund’s financial shortfall.

The fund received around 510 million euros in budget support in 2023. This shows that the amount required from the budget has almost doubled within three years. The across-the-board pension increase, which totaled 7,000 denars, has also contributed to the rise in expenditure.

The minister said this measure had to be taken because of the low incomes of some pensioners. Among other factors contributing to the deficit, he cited the emigration of the working-age population, fluctuations in the workforce and the high number of employees officially registered as earning the minimum wage.

Assuring the public that pensions are not at risk, Velkovski said that “the state is the guarantor and pensions will be paid on time.” He announced reforms aimed at strengthening the system but did not provide any financial estimates or a specific timeline for when the fund’s dependence on the state budget could be reduced.

Meanwhile, the government is also considering possible changes to the second pension pillar. One option would allow citizens to decide whether they wish to remain solely in the state fund or continue making payments into private funds as well./Telegrafi/