Hostname: page-component-cd9895bd7-dk4vv Total loading time: 0 Render date: 2024-12-27T11:42:39.102Z Has data issue: false hasContentIssue false
  • English
  • Français

Protection mechanisms in the old-age pension systems of the CEE countries*

Published online by Cambridge University Press:  09 July 2012

MARCIN KAWIŃSKI ,
DARIUSZ STAŃKO  and
JOANNA RUTECKA
MARCIN KAWIŃSKI
Affiliation:
Department of Social Insurance, Warsaw School of Economics
DARIUSZ STAŃKO
Affiliation:
Department of Social Insurance, Warsaw School of Economics, Wisniowa Str. 41, 02-520 Warsaw, Poland (e-mail: [email protected])
JOANNA RUTECKA
Affiliation:
Department of Social Insurance, Warsaw School of Economics
Get access Rights & Permissions [Opens in a new window]

Abstract

Since 1990s, substantial changes in the role of the state in the social security schemes can be observed in the countries of the Central and Eastern Europe (CEE). While the general framework of social benefits in the CEE countries is still defined by the state, more and more often the task of provision of social security is transferred to the private entities. Such privatization of social policy makes the need for protection mechanism and some state guarantees even stronger. It is still the state that is responsible for the final outcome of social security systems so that is why governments are directly providing or indirectly creating safety mechanisms built-in the private market mechanism used for social purposes. The paper surveys various types of the protection mechanisms in selected CEE countries that exist in the important and already most privatized element of the social security system – the pension system. While describing the safety measures and possible guarantees, special attention is paid to the new forms that have been built up recently. The paper covers both mandatory and voluntary pension markets and identifies present and possible threats in the existing frameworks that can harm the social security. The paper concludes with general assessment and policy recommendations.

Keywords

H55G23Protection mechanismspension systempension reformfunded pension funds
Type
Articles
Information
Journal of Pension Economics & Finance , Volume 11 , Issue 4 , October 2012 , pp. 581 - 605
Copyright
Copyright © Cambridge University Press 2012

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

*

The authors wish to thank two anonymous referees who provided a number of useful suggestions. We are grateful to respondents to our questionnaire – Mihai Bobocea, Damir Grbavac, Igor Guardiancich, Ilona Juhász, Stoian Kramarski, Audrone Morkuniene, Csaba Nagy, Vidija Pastukiene, Jiří Rusnok and Ona Stravinskaite for their valuable inputs.

References

Anusic, Z., O'Keefe, P. and Madzarevic-Sujster, S. (2003) Pension Reform in Croatia, Social Protection Discussion Paper Series No. 0304. Washington: The World Bank.Google Scholar
Arthur, G. (2009) Multifunds: lessons from experience. A presentation for FIAP conference “Multifunds – Implementation and Prospects in the Pension System of the Central and Eastern European Countries”, Sofia, Bulgaria, 17–18 September 2009.Google Scholar
Augusztinovics, M. and Kölló, J. (2009) Decreased employment and pensions: The case of Hungary. In Holzmann, R., MacKellar, L. and Repanšek, J. (eds), Pension Reform in Southeastern Europe: Linking to Labor and Financial Market Reform. Washington: The World Bank, pp. 89–104.Google Scholar
Blake, D. (2006) Pension Economics. New York: Wiley & Sons.Google Scholar
Blake, D., Alistair, B. and Dowd, K. (2005) The Stakeholder Pension Lottery: An Analysis of the Default Funds in UK Stakeholder Pension Schemes. The Pensions Institute, Cass Business School, City University, Discussion Paper PI-0411.Google Scholar
Blake, D. and Burrows, W. (2001) Survivor bonds: helping to hedge mortality risk. Journal of Risk and Insurance, 68: 339–48.Google Scholar
Blake, D., Cairns, A., Dowd, K. and MacMinn, R. (2006) Longevity bonds: financial engineering, valuation and hedging. Journal of Risk and Insurance, 73(4): 647–672.Google Scholar
Chlon, A. and Mora, M. (2003) Commitment and consensus in pension reform underpinnings. In Holzmann, R., Orenstein, M. and Rutkowski, M. (eds), Pension Reform In Europe: Process And Progress, Washington: The World Bank.Google Scholar
Chłoń-Domińczak, A. and Mora, M. (2006) The NDC Reform in the Czech Republic. In Holzmann, R. and Palmer, E. (eds), Pension Reform: Issues and Prospects for Non-Financial Defined Contribution (NDC) Schemes, Washington: The World Bank, pp. 551–572.Google Scholar
Chłoń-Domińczak, A. and Strzelecki, P. (2010) The minimum pension as an instrument of poverty protection in the defined contribution pensions system – an example of Poland, MPRA Paper 25262. Munich: University Library of Munich.Google Scholar
De Menil, G. and Sheshinski, E. (2002) Romania's Pension System: From Crisis to Reform. In Feldstein, M. and Siebert, H. (eds), Social Security Pension Reform in Europe, National Bureau of Economic Research, pp. 401–438, http://www.nber.org/books/feld02-2.Google Scholar
European Commission (2012) White Paper. An Agenda for Adequate, Safe and Sustainable Pensions, COM(2012) 55 final, 16.02.2012, Brussels.Google Scholar
Fultz, E. (ed.) ( 2006). Pension Scheme, Social Security Reform, Estonia, Latvia, Lithuania. Geneva: ILO.Google Scholar
Gillion, C. (1999) The ILO and Pensions. Geneva: Social Security Department, ILO.Google Scholar
Goliaš, P. (2005) Pension Reform in Slovakia. Institute for Economic and Social Reforms http://www.ineko.sk/reformy2003/menu_dochodky_paper_golias.pdf.Google Scholar
Guardiancich, I. (2010) Pensions and social inclusion in three ex-Yugoslav Countries: Slovenia, Croatia and Serbia. Acta Oeconomica, 60(2): 161–195.Google Scholar
Hetteš, M. (2009) Good and Bad Practices/Lessons in Slovak Pension Reforms, International Labour and Social Affairs Director General, Ministry of Labour, Social Affairs and Family, Slovakia. In Pension Reform in Serbia from International and Regional Perspectives: Proceedings of the Conference on Pension Reform in Serbia, 24–25 September 2009, Belgrade, International Labour Office.Google Scholar
Hirose, K. (2009) Pension Reform in Serbia: Challenges and Directions for Reform, ILO Subregional Office for Central and Eastern Europe. In ILO, Pension reform in Serbia from international and regional perspectives: proceedings of the conference on pension reform in Serbia, 24–25 September 2009, Belgrade, International Labour Office.Google Scholar
Holzmann, R. and Hinz, R. et al. (2005) Old-age income support in the 21st century: an International Perspective on Pension Systems and Reform. Washington: The World Bank.Google Scholar
Kawiński, M. (2010) How to present performance of pension funds to the future pensioners? Paper on Social Policy Association 2010 Conference: Social policy in times of change 5–7 July 2010, Lincoln.Google Scholar
Kawiński, M. and Stańko, D. (2009) Problem akwizycji w polskim systemie emerytalnym. In Polish: Acquisition Problem in Pension System. Wiadomości Ubezpieczeniowe, No. 2.Google Scholar
Müller, K. (2008) Pension Privatization and Economic Development in Central and Eastern Europe: A Political Economy Perspective, United Nations Research Institute for Social Development Working Paper.Google Scholar
OECD (2001) Ageing and Income: Financial Resources and Retirement in 9 OECD Countries. Paris: OECD.Google Scholar
Owczarek, J. (2010) Zakres redystrybucji dochodowej w ubezpieczeniowym systemie emerytalnym. In Polish: range of income redistribution in insurance pension system, PhD dissertation, Warsaw School of Economics.Google Scholar
Palmer, E. (2007) Pension reform and the development of pension systems: An evaluation of World Bank assistance. Background Paper Bulgaria Country Study. Washington: The World Bank.Google Scholar
Palmer, E., Stabin, S., Svensson, I. and Vanovskap, I. (2006) NDC strategy. In: Holzmann, R. and Palmer, E. (eds), Latvia: Implementation and Prospects for the Future in Pension Reform Issues and Prospects for Non-Financial Defined Contribution (NDC) Schemes. The World Bank: Washington (Chapter 15).Google Scholar
PensioniKESKUS (2010) http://www.pensionikeskus.ee.Google Scholar
Piggott, J. and Sane, R. (2009) Indexing Pensions, SP Discussion Paper No. 0925, Social Protection and Labor. Washington: The World Bank.Google Scholar
Rocha, R. and Vittas, D. (2002) The Hungarian pension reform: A preliminary assessment of the first years of implementation. In Feldstein, M. and Siebert, H. (eds), Social Security Pension Reform in Europe. National Bureau of Economic Research, pp. 365–400, http://www.nber.org/books/feld02-2.Google Scholar
Sen, A. (1979) Equality of What? The Tanner Lecture on Human Values, Delivered at Stanford University, May 22.Google Scholar
SPC (2008) Privately Managed Funded Pension Provision and Their Contribution to Adequate and Sustainable Pensions, The Social Protection Committee.Google Scholar
Stańko, D. (2004) Performance Measurement Regulation Issues in New Polish Pension System. Osaka Economic Papers, 53(4): 78–88.Google Scholar
Stańko, D. (2008) Public annuity fund and public pension funds in pension policy making in Poland. Osaka Economic Papers, 57(4): 100–123.Google Scholar
Stańko, D. (2009) Pension Funds Returns: The Case of Central and Eastern Europe. In Investments and Payouts in Funded Pension Systems. Santiago, Chile: International Federation of Pension Fund Administrators (FIAP), pp. 25–45.Google Scholar
Stańko, D. (2010) Doświadczenia z wprowadzania wielofunduszowości w innych krajach [In Polish; Experiences from introducing multifund systems in other countries] pp. 24–44. In Wiktorow, A. and Wyżnikiewicz, B. (eds), Wielofunduszowość w systemie emerytalnym [In Polish; Multifunds in Pension System], Warsaw: Instytut Badań nad Gospodarką Rynkową, January 2010.Google Scholar
World Bank (1994) Averting the Old Age Crisis: Policies to Protect the Old and Promote Growth. Washington: Oxford University Press.Google Scholar
World Bank (2006) Pension Reform and the Development of Pension Systems. An Evaluation of World Bank Assistance. Washington, DC: The World Bank.Google Scholar
World Bank (2009) Pensions in Crisis: Europe and Central Asia Regional Policy Note, Human and Development Unit, November.Google Scholar
Yermo, J. (2002) Revised Taxonomy for Pension Plans, Pension Funds and Pension Entities. Paris: OECD.Google Scholar