CZECH REPUBLIC - Czech Finance Minister Miroslav Kalousek wants changes to the pension program, aimed at reducing the fiscal deficit and improving the country's credit rating, to take effect by 2012.
"My ideal plan is for the reform to take effect from 2012, and the legislative process should start at the beginning of 2011," Kalousek wrote today in response to e-mailed questions.
Prime Minister Petr Necas's Cabinet, which took office last month, has pledged to cut the fiscal gap to within the European Union's limit of 3% of economic output by 2013 from 5.9% last year.
Standard & Poor's said on August 10 it may raise the Czech credit rating if the government follows through on its promises, including an overhaul of the pension system.
The government is assessing different proposals, including those made by an expert panel led by Vladimir Bezdek under the previous administration, Kalousek said.
The panel this year recommended raising the retirement age and allowing taxpayers to divert a part of their social-security payments to private accounts to stop the ageing population from boosting social spending.
"The government has pledged to complement the pay-as-you- go system with an option for individual savings," Kalousek wrote today. "There are many options. I will obviously pay attention to their short-term and long-term sustainability for public finances."
Collective defined contribution (CDC) savers should be allowed to access pension freedoms when the scheme is rolled out, last week's Pensions Buzz respondents said.
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