Pension reform in Croatia is successful and it needs to be continued, a news conference heard at which results of the work of pension funds from 2002 to present were presented.
The press conference was organised on Tuesday by the association of pension funds management companies and pension insurance companies of the Croatian Chamber of Commerce.
The president of the association of pension funds management companies and pension insurance companies, Dubravko Stimac, said that the pension reform 2001/2002 created a robust, more just and more sustainable pension system.
He said that mandatory pension funds had met and exceeded the set level of yields, adding that the the contribution of pension funds to the national economy was already significant.
Stimac stressed the pension system reform had been carried out because the first pillar was not sustainable and that the second pillar was set up to help the first pillar to become functional and sustainable over time.
He stressed that the pension reform created new national savings which today total over HRK 36 billion and are increasing every month.
Nine years after their establishment, mandatory pension funds generated an annual yield of 5.27 per cent, while the annual inflation rate in the said period amounted to 2.68 per cent, which in real terms translated to a yield of 2.59 per cent. At the start of the reform it was said that it would be good if funds could generate yields of two per cent more than an inflation rate.
With such yields, pension funds have secured a total of HRK 5.12 billion as new value by December 2010.
Commenting on the second pillar, Stimac said that funds had so far collected HRK 1.43 billion in fees.
In Croatia, entry fee is 0.8 percent and management fee is 0.75 percent for mandatory pension funds, while in Poland entry fee is 3.5 percent and management fee 0.54 percent, in Hungary 4.5 percent and 0.8 percent respectively in Bulgaria 5 percent and one percent respectively.
