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June 22, 2021
ECONOMY FINANCE&BANKING

Teodorovici: Nationalising Pillar II Pension Fund is out of the question. It’s natural for there to be an analysis of the approximately 10 years of functioning of this mechanism and we will publicly present the results in June-July

Finance Minister Eugen Teodorovici stated again, on Monday, during the debates on the simple motion tabled by PNL against him, that nationalising the Pillar II Pension Fund is out of the question and that he will never counter balance the budget deficit with the incomes of Romanians, whether we are talking about salaries or pensions. He added that it is natural for there to be an analysis after approximately ten years in which the Pillar II Pension Fund has functioned, and its results will be made public in June-July.

“Regarding Pillar II, so much discussed and disputed lately, I want to point out two things. Firstly, a nationalisation is out of the question. I said that it’s natural for there to be an analysis after approximately 10 years in which this mechanism functioned, and that we will publicly present its results in June-July. Consequently, any speculation only serves to generate groundless suspicions, proving the amateurishness and bad faith of those who are spreading such ideas. Secondly, as Romanian citizen, as member of a left-wing party, and, last but not least, or maybe precisely because of this reason, as Finance Minister in a PSD Government, I will never counter balance the budget deficit with the incomes of Romanians, whether we are talking about salaries or pensions. Never!” Teodorovici said.

After the debates in the plenum, he said that in June there will be discussions with the administrators of the seven pension funds and that he hopes that, until then, they “would stop making the statements they are unjustifiably making.”

“We are not starting off from the idea of abolishing something, of suspending Pillar II transfers. I said it’s a potential option so that, when things are very clear, and the people are able to, why shouldn’t they choose (…)? The first option is to carry out a very clear analysis. In June we will definitely talk with the seven pension funds; during this time, I hope they will stop making the statements they are unjustifiably making. (…) They must administer, not express opinions or inform who knows what law firm. There are typical statements. I said that [the analysis will take place] in June-July, it hasn’t changed,” the Finance Minister stated.

Teodorovici explained that there is an administering cost of RON 1.5 – 1.6 billion that Romanians are paying for the Pillar II Pension Fund and other private pension funds: “We have, on one hand, a cost of 1.5 – 1.6 billion lei that Romanians are paying for these and other private pension funds, plus the interest cost. (…) At the level of Government, with the Labour Ministry but not only with it, there will be a discussion with the other actors; we will sit, discuss, and, without any other elements, we will establish the best approach for the future.”

Likewise, he said that these commissions may change: “Yes, it’s a topic. Today’s commissions – one billion and a half [lei] at 10 years is an important sum, to which one adds the costs of financing, cost of borrowing, interest rate costs for the government bonds that the pension funds place with the state.”

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