Bulgarians are to be able to contribute to a new, fourth type of pension scheme, linked to their occupations.
This is provided for in amendments to the Social Security Code proposed by the Cabinet and given final approval by Parliament on June 28.
The bill was drafted to harmonise Bulgarian law with the European Union directive on the equal treatment of women and men in social insurance schemes and the directive on the preservation of additional pension rights while moving within the EU.
The amendments adjust the existing pension model establishing a fourth “pillar” for occupational pension schemes, said Deputy Labour and Social Policy Minister Goran Bankov. The established pension associations will manage the pension schemes, and the money for the occupational schemes will accumulate in a new, fourth type of fund.
Workers and employees will be eligible for a fourth pension after the age of 60. The eligible age is the same for women and men, which is in line with the EU requirements.
The pension association managing the money will have the opportunity to do so for companies in all EU member states.
Currently, all employed Bulgarians contribute from their monthly income to three pension schemes - an obligatory state pension fund, an obligatory contribution to a private pension fund and a voluntary contribution to the latter.
In another development on June 30, Parliament raised the minimum contributory-service and retirement-age pension by 14.8 per cent from 72.45 leva to 85 leva as of July 1 2006.
A total of 624 826 retired people will benefit from the minimum pension increase, said the chairperson of the parliamentary committee on labour and social policy, Hassan Ademov.
Pensions below 120 leva will increase by five per cent as of July 1, while those between 120 and 150 leva will increase by four per cent. A total of more than one million pensioners will benefit in this case, Ademov said.
The amendments to the Social Security Code provide that the scale of the minimum contributory-service and retirement-age pension will be set every year under the Public Social Security Budget Act rather than as a percentage of the social old-age pension. The minimum sizes of the other pensions, such as the personal disability pension and inheritance pensions will be set up as a percentage of the minimum contributory-service and retirement-age pension.
The Cabinet will set the minimum contributory-service and retirement-age pension on the basis of proposals by the Labour and Social Policy Minister for the period from July 1 to December 31 2006. The Government has been assigned the task of compiling one-off indexing of the personal contributory-service pensions as of July 1 2006.
