Abstract
Central and Eastern European countries (CEE) introduced funded pension systems 15-20 years ago. Such funded pensions had to be built up from nothing in CEE countries as they were non-existent prior to that time. Ensuring diversification of old age pension income, attracting additional financing sources to pension systems, assuring retirement income adequacy and balancing future state obligations to retirees were the main objectives of funded pension scheme. State encouraged participation in funded pension systems by through various incentives – matching contributions, non-tax financial incentives, fixed nominal subsidies. While there is much debate about the utility of an individual’s participation in funded pension scheme, however there is rarely any focus on assessment of the role and benefits of the state participation. No scientific research and analysis have been conducted to assess the utility of state participation in funded pension systems at the macro (state) level. The aim of the study is to evaluate the results and benefits of state participation in funded pension scheme in various aspects, including the financial sustainability of public pension system, in selected CEE countries over the last 20 years. The results show that in the Baltic countries the fiscal costs of state participation do not exceed future benefits from funded pension scheme, which will reduce the need for social security funding for old-age pensions.
Presenters
Tadas GudaitisProfessor, Vilnius University Institutional Code: 211950810, Lithuania Teodoras Medaiskis
Professor, Faculty of Economics and Management, Vilnius University, Lithuania Jaroslav Mečkovski
Student, Master's degree, Vilnius University, Lithuania, Lithuania Virginija Poskute
Associate professor, ISM University of Management and Economics, Lithuania
Details
Presentation Type
Paper Presentation in a Themed Session
Theme
Public Policy and Public Perspectives on Aging
KEYWORDS
Social Security; Retirement Policies; Public Pensions; Private Pensions
