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November 13, 2019

Value of pension point, up 5pct from January 1

The value of the pension point will increase by 5pct from January 1 to 871.7 lei, according to the Government’s Emergency Ordinance 57/2015 on salaries of staff paid from public funds in 2016, published in the December 11, 2015 issue of the Official Gazette.

Currently, the pension point’s value is 830.2 lei.

Also, according to the same ordinance, in 2016 state military pensions will go up by 5pct.

At end-November, according to the Ministry of Labour’s statistics, the average state social insurance pension was 886 lei and 362 lei for farmers.

The total number of pensioners was 5.1311 million people.

On the other hand, the contribution to the mandatory private pension system, Pillar II, will increase only by 0.1 percentage points next year, although market operators expected an increase by one percentage point to reach the 6pct level established by law.

Minister of Public Finance Anca Dragu said that part of the money left in Romanians’ pocket from the tax cuts provided by the new Tax Code can go to optional pension, Pillar III respectively.

Currently, the contribution paid to Pillar II of pensions is 5pct, and in 2016 it should have reached 6pct, as provided by Law no. 411/2004.

According to the schedule on increasing contributions to Pillar II, from 2008 to 2016 these should have been increased from 2pct by 0.5 percentage points annually. But in 2009, the government of the time decided to freeze contributions for a year because of the crisis, but all governments that followed promised to recoup those 0.5 percentage points.

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