Romanian gov’t to temporarily suspend transfers to Pension Pillar II. Starting 2019 the contribution will be a fixed amount

The Romanian government’s Legislative Program for 2018 includes, among other priorities, a draft act on the functionality of the second (private) pension pillar. This document reveals a plan to suspend the transfer of part of pension contributions from all employees to the private administered investment funds, between July 1st and December 31st of this year.

Also, according to the document quoted by Mediafax, the social contribution (CAS) will be collected fully to the national budget. Currently, 3.7 percent of the contributions collected from employees are transferred to the second pension pillar.

The changes come after social contributions were transferred entirely to the employee at the beginning of this year.

The American Chamber of Commerce in Romania (AmCham Romania) expressed, last week, its concern regarding possible measures and public policies that could affect the wealth of the employees during their career and retirement period, and that could at the same time reduce the development potential of the Romanian financial market.

The Foreign Investors Council (FIC), which brings together companies hiring approximately 200,000 people, has also expressed concern about possible policy measures affecting the three-pillar pension savings system and the lack of transparency in which these are analyzed and promoted.

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