Ratio between number of employees and pensioners to reach 0.4pc in 2050

The ratio between the number of employees and pensioners in Romania will reach 0.4 percent in 2050 compared to 0.94 at present or 3.3 percent in 1990, said on Wednesday the president of the Association for Privately Administered Pensions in Romania (APAPR), Crinu Andanut, at the National Conference on Private Pensions.

Among the chronic problems of the public pension budget, besides the continuous worsening of the ratio between employees and pensioners, Andanut stressed the early retirement (before the age limit), which grew from 27.7 percent of the overall pensioners in 1990 to 34 percent in June 2009, early retirement and/or without compete stage of contribution grew fro 54.9 to 59 percent, the real age of retirement is 54 years, although the age limit is 58 years and 8 months for women and 63 years and 8 months for men.

On the other hand, the Romanian state pension system (Pillar I) ensures one of the lowest state pensions in Europe, plus one of the lowest replacement rates (pension/salary ratio). 'Almost 3.9 million pensioners have less than 1,000 lei/month, respectively 81 percent of the total. Only 44,000 pensioners have over 2,000 lei/month, namely 0.9 percent of the total. Although pensions are very low, economy and state budget cannot endorse higher levels. Pensions are already by some 20 percent higher than the national economy and the public pension budget can finance, said the president of APAPR.

According to national trade union confederation Cartel Alfa, the public pension system ensures for each leu spent during the active period a pension of 0.25 lei, namely a negative nominal yield of minus 75 percent, Agerpres reports.