“From my point of view, it is an amendment to the law that changes the parameters of our ongoing pillar quite fundamentally. If we did nothing, the pension system would begin to fall into relatively significant annual deficits in 2030, with the greatest impact occurring around 2055,” said Minister of Labor and Social Affairs Marian Jurečka (KDU-ČSL) during the presentation of the reform in the Senate ).
The government plan includes a number of basic points. Probably the most obvious is the breaking of the current limit for retirement, which should have been fixed at 65 for most people. For women with two or more children, it should have been a little later.
CLEARLY: What the pension reform will change
Economy
The retirement age will increase by one month every year from the year of birth in 1966 until it stabilizes at 67 for those born in 1989 and younger.
But the opposition warns that if he wins the election, he will return the retirement age to a maximum of 65 years. “The age of 67 is meaningless,” said Jana Mračková Vildumetzová, a senator for the ANO movement, referring to the reminder of the Ministry of Health from the reminder procedure for the reform, according to which the population over the age of 65 is not in such a state of health that they are able to perform the necessary work even in next years.
A relatively significant point is the gradual slowing down of the year-on-year increase in newly granted pensions. This will take place between 2026 and 2035. The new pensioners will thus receive about 180 to 200 crowns less per year than they would receive according to the current formula.
Spouses or registered partners will be able to decide to divide the achieved assessment bases in half for the period when both worked. People caring for sick family members will then be assessed a pension for the period of care based on the average salary in a given year.
Dispute about premature profession
People from professions in the fourth risk category will then be able to retire up to five years earlier according to the number of shifts. And that without their early pension being cut short. But employers will pay higher premiums for them.
Originally, it was supposed to apply to people in the third risk category, who are exposed to significant vibrations, heat, cold and general physical stress. In the end, however, the deputies exempted these employees from the adjustment by means of an amendment. This provoked protests not only from the opposition, but also from some coalition legislators. Therefore, the Ministry of Finance is to prepare a proposal according to which these workers will be paid up to four percent of their gross wages to individual pension savings accounts.
“If someone works in a demanding profession today, why shouldn’t they be entitled to early retirement without being cut short?” After all, he goes to it because the demanding profession has an effect on his health,” countered Vildumetzová.
According to Jurečka, the change will be more beneficial for people from the third risk category. “It gives them more individual space to choose a strategy,” he said. According to him, these people will be able to choose whether to go into pre-retirement, or use the saved money only in retirement.
Other significant changes include the introduction of the family assessment basis, which is to replace the educational basis for the first two offspring over time. That is, five hundred a month for everyone for retirement. With this basis, the pension during parental leave would be calculated from the average salary in the given year.
For people who obtained or will obtain the right to educational allowance before the reform, this contribution will remain, but will not be valorized.
There will also be an increase in the minimum pension to 20 percent of the average wage.
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Economy
