Pensioners insist that a member be included in the law, according to which their income must not be below 50 percent of the average salary, and if that happens, that they be extraordinarily adjusted.
Although the confirmation that there is no reason for pensions to be reduced even in the event of a deepening economic crisis, as our list was told two days ago by the Fiscal Council, should please 1.7 million pensioners in Serbia, they were surprised that mentions a reduction in their income.
They are aware, they say in the pensioners’ unions of Serbia and Vojvodina, of the consequences of the coronavirus pandemic on the economy and GDP growth, but they believe that they should not be on the list of those that the state is counting on to save on because they are the biggest burden. They endured the previous economic crises by the fact that for a large number of them the pension was and remained reduced.
Milan Nenadic, president of the Association of Pensioners of Serbia, says that the initiative of the Fiscal Council from 2019 to harmonize pensions by 75% with the growth of inflation and only 25 with the growth of salaries exclusively means further devaluation of pensions, and the current average is 240 euros.
– In the conversation with the pensioners at the local, we realized that they expect the current Swiss formula, which implies adjusting 50 percent with the growth of salaries and the same amount with the growth of inflation, to improve and advance as promised before the corona, and not to regress, by their incomes to a lesser extent follow the growth of salaries – Nenadic is categorical.
He points out that the Swiss formula was adopted in order for pensioners to recover from reduced and frozen pensions during five years, and the only thing they expect now is for a member to be included in the law, which will prescribe that pensions must not fall below 50% of average salary. And if that happens, they automatically adjust extraordinarily.
– At this hour, the share of the average pension in the average salary is around 47 percent, and if the formula 75 to 25 were changed, that share would additionally fall to around 44 percent. So, pensions would lag even further behind salaries – our interlocutor points out.
He explains that with the proposed change, the adjustment based on inflation would increase the growth of pensions by about two percent, and on the other hand, in some branches, the growth of salaries was recorded from seven to 10 percent, which pensions should be accompanied by an adjustment of 50 percent.
In addition, emphasizing at this time, he points out, that the Pension and Disability Insurance Fund is based on generational solidarity is not appropriate because pensions are earned and the personal right of each individual who paid contributions to the fund’s coffers during his working life.
– If, due to a possible budget deficit caused by the pandemic, a change in the formula is to be made at this time, it could only be stated in an article that 2021 will be exempted from the obligation of extraordinary adjustment of pensions when they fall below 50 percent of average earnings. Otherwise, everything else would greatly devalue pensions – he points out.
Prof. Dr. Andrija Savic, President of the Association of Pensioners of Serbia, agrees with all these allegations and adds that pensions should not be touched or the formula should be changed, especially if it is known that a large number of pensioners are not compensated even after four years of reducing pensions under the Provisional Decree.
The statistics of the Pension and Disability Insurance Fund, says Savic, say more than anything that pensions are modest. The average in January-June this year is 470 euros for the largest number of the oldest, Politika reports.
