“Regardless of the forecast option, the annual balance of the Social Insurance Fund (FUS). is constantly decreasing, which means that the financial situation of the fund is deteriorating” – we read in the latest report of the Social Insurance Institution under the title: “Forecast of income and expenses of the Social Insurance Fund for 2024-2028”, obtained by money.pl. How does it look in practice?
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ZUS displays the latest report on the state of FUS
- in the intermediate option – by 30.1 billion PLN (the projected annual deficit in 2024 is 71.1 billion PLN, and in 2028 – 101.2 billion PLN),
- in the pessimistic version – by PLN 44.3 billion (the projected annual deficit in 2024 is PLN 80.5 billion, and in 2028 – PLN 124.8 billion),
- In the optimistic option – by PLN 19 billion (the projected annual deficit in 2024 is PLN 63.6 billion, and in 2028 – PLN 82.6 billion).
The financial situation of the Social Insurance Fund is significantly influenced by the number of people receiving pensions and annuities financed from the FUS and the number of insured persons, which is influenced by demographic and macroeconomic assumptions, the ZUS report explains.
In the intermediate option, the number of people covered by pension and disability insurance increases in 2024, and decreases in the subsequent years of the forecast. In the pessimistic version This number will decrease during the forecast years. In the optimistic scenario, pension and disability insurance will increase by 2026 and decrease in 2027-2028.
What does it look like in numbers? The increase in the number of pensioners receiving benefits financed from the Social Insurance Fund in 2028 compared to 2024, depending on the option, is:
- In the intermediate option – PLN 196,000. (growth 2.4%),
- in the pessimistic version – 256 thousand (increase by 3.2%),
- In the optimistic version – 181 thousand (increase by 2.3%).
We are not facing bankruptcy
Money.pl asked Pawel Jaroszek, a member of ZUS's management board, about the institution's latest forecasts. In the conversation, he assures us that the current situation of the Social Insurance Fund is very good. Fund efficiency, i.e. the degree to which benefit costs are covered by contributions, remains at a record level – 85 percent. in 2022 and about 84 percent in 2023
As Jaroshek notes, despite the worse balance, the situation of the social insurance fund will be stable in the coming years, “as the forecast shows.” – The slight decline in coverage is primarily due to the fact that we are entering a period when those born in the post-war baby boom are reaching retirement age. – says Jaroshek.
– We have a reformed pension system, in which the amount of pension is closely related to the amount of pension contributions paid by the insured to the system and the expected period of receiving benefits. The reform made it possible for the state to avoid irreparable liabilities in the future, despite the expected deterioration of the demographic structure of Polish society. Thus, the aging population does not pose as much of a threat to the financial stability of the pension system in Poland as in many other countries. – Explain.
Defined contribution system
We remind you that we adopted the so-called defined contribution system in Poland at the end of the 1990s. The principle is simple: What you pay for the system is what you get. In this case, the pension is simply the sum of the indexed contributions divided by the average life expectancy. The longer we live and the less we work legally, the less benefits we receive.
After the reform, our pensions were not credited with the initial capital, as was the case with previous benefits (ZUS could not determine how much everyone worked, so they took the appropriate amount in advance – editor's note). These pensions are high, but over the years their number in the system will decrease.
ZUS analysis shows this that around 2040 the share of pensions from the old system will be minimal, Which will accelerate the reduction of Poles' pension if they no longer want to work.
System collapse coming?
The estimates are dramatic. The European Commission announced this a year agothat the replacement rate in Poland, that is, the ratio of the future pension to the last salary, will decrease sharply. In 2060, our pension will be only 25%. last salary Currently, this figure is about 54%.
However, we are not in danger of system collapse.
– There is no talk of bankruptcy of the pension system. These types of misconceptions are caused by ignorance of the functioning of the pension system in Poland. The stable financial position and long-term solvency of the system are proven, including: reports from independent organizations such as the Organization for Economic Co-operation and Development (OECD) or European Commission – Pavel Jaroshek explains.
It cites OECD data from its Pensions at a Glance 2021 report which states that The share of public pension expenditure in Poland's GDP was 10.6% in 2019, and is expected to be 10.8% in 2060, or about the same.
– In other countries, the burden of pension costs is expected to increase significantly in the future, for example, in Belgium by 25%, and in the Czech Republic, Ireland, New Zealand, Slovakia, Slovenia and Hungary by 50-70%, which means. A few percentage points. GDP – summarizes the member of the ZUS management board.
Damian Szymanski, deputy head and journalist of money.pl
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