Only 18% of the local companies offer private pensions, although these have a neutral impact on their financials, as companies don’t have to pay taxes and contributions for them in the limit of EUR 400 per year, said Diana Coroaba, Tax Partner with PwC, referring to a survey on salaries. Companies should first educate their employees on this, Coroaba added.

“It’s difficult to tell an employee that I’ll stop paying you a bonus, but I’ll give you a voluntary pension plan, without previously educating the employee about this,” she said, cited by local Agerpres.

In the current system, one working person supports 1.3 pensioners, said Raluca Tintoiu, chairman of the Romanian Private Pension Funds Association. However, starting 2032, one working person will support 2.5 pensioners. This will put a lot of pressure on the public pension system, and there will be less money to pay the state pensions, she added.

Employers should do more to promote the voluntary pension system in Romania, Tintoiu said.

editor@romania-insider.com