Are you sure?

Parliament approves legislation rolling back pension reform

Parliament on Monday approved legislation that effectively eliminates a pillar for Hungary's three-pillar pension system. The vote was taken by 250:58 with 43 abstentions. The legislation gives members of mandatory private pension funds until January 31, 2011 to opt out of a transfer of their pension savings to the state pillar. Members who decide to stay in the funds will lose all future contributions to the state pension system by their employers. The legislation is a de factor rollback of pension reforms in the late 90s that established a funded pension pillar alongside the state's pay-as-you-go system. The legislation establishes a fund to be managed by the Government Debt Management Agency (AKK), into which the assets of those returning to the state pillar are to be placed. Assets in the form of government securities, which make up about half of the total, are to be withdrawn, while the shares will be sold off gradually. Revenue from the assets sold is to be used for the State Pension Fund, to meet other targets in the budget or to reduce state debt, according to the text of the bill. (MTI-Econews)