Skopje, 12 December 2024 (MIA) - Pension and Disability Insurance Fund director Nikola Memov stated that the recommendations from the Fiscal Council regarding retirement are not acceptable under the current conditions and at this moment. As he pointed out, the government has made this clear, and the recommendations will not be included in the Fiscal Strategy for the period 2025-2029. Memov also noted that the primary source of financing for the Pension and Disability Insurance Fund is its own revenues.

“The Fiscal Council's recommendations on retirement are not acceptable under the current circumstances, at this moment. The government has clearly expressed this, and they will not be included in the Fiscal Strategy for the period 2025-2029. In the present conditions in the country, the government believes that the time is not yet right to move forward with this and that the priority should be to preserve the momentum of social transfers,” Memov told Telma TV.

According to him, citizens need higher social transfers, meaning more support for the social aspect of the country. Memov stressed that all citizens feel the pressure to improve their standard of living due to rising prices.

He added that the main source of funding for the Pension and Disability Insurance Fund is from source revenues, specifically from the pension and disability insurance contributions to gross wages, which stand at 18.8 percent.

As he stated, of the 18.8 percent of source revenues, only a portion is used for pension payments, while another part is transferred to the so-called second pillar in the country.

“12.8 percent is allocated for pensions, while 6 percent, or one-third of the total budget collected from these financing sources, is transferred to the second pillar. The source finances, that is, the 18.8 percent, are not sufficient to cover all pension payments,” Memov said.

He added that previous governments, since the formation of the Macedonian state, have known that funding cannot be fully covered by pension and disability insurance contributions.

As he mentioned, additional passive income had to be secured to fill the budget for pension payments, which is why a new reform with three pillars was implemented in 2003, applying the concept of passive financing sources.

“Transfers from the government to the pension fund for pension payments were strategically designed and placed. The government, 20 years ago, knew that one-third of the collected budget would be paid into and accumulated in the second pillar,” Memov said.

He also pointed out that digitalization is a top priority for the Pension Insurance Fund.

Next week, as he announced, they will launch 17 new web services through e-Government, allowing citizens to submit requests online to the Fund.

Photo: screenshot