Residents were surveyed about additional pension accumulation: the results were unanimous

According to the survey data, 61 percent respondents completely agree, and 21 percent rather, he agrees with the statement that the inclusion of residents in Tier II pension funds must not be forced. 7 and 4 percent disagree and rather disagree with this statement, respectively. of those interviewed. 7 percent did not know or did not answer this question.

From a deeper analysis, we see that people of practically all ages and income groups, regardless of whether they live in cities or villages, think similarly.

In order to be able to withdraw 25% if needed once in a lifetime. from their accumulated amount before reaching retirement age, 61% fully agree, 26% rather agree. respondents. 2% do not support it at all, and rather 4% do not support it. of those interviewed. Another 7 percent respondents did not know or did not answer.

Such an idea is supported by people of all ages and incomes, regardless of where they live.

Vilija Blinkevičiūtė, the chairwoman of the Lithuanian Social Democratic Party (LSDP), who commented on the survey, said that according to her, and as shown by the decision of the Constitutional Court (CT), they were right in suggesting for a quarter and a half years to abandon forced enrollment in second-tier pension funds, to allow people to withdraw from them. As the politician reminded, the Social Democrats also offered to provide the opportunity to use part of the funds accumulated in the fund before reaching retirement age.

“The LSDP Seimas faction registered several draft laws, the president also submitted amendments, but all proposals were rejected by the ruling majority of conservatives and liberals. It is disappointing that this Government often defends the interests of pension funds, not people,” said V. Blinkevičiūtė.

According to her, mandatory inclusion in pension accumulation is an incorrect practice.

“This is not the way to treat people’s money and fortunes. Maybe a person is sick, maybe a big accident happened and he needs money – he must have the right to take his accumulated money.

After the Supreme Court clarified that the procedure enshrined in the law, which does not allow people to take the money accumulated in the second-tier pension fund, contradicts the Constitution, we proposed to change the law again”, emphasized V. Blinkevičiūtė.

The Social Democrats propose to give the participants of the second tier pension the opportunity to receive a benefit if they themselves or their family members fall ill with a serious illness, as well as in the event of the death of a loved one, in case of disability or loss of working capacity, if necessary, dental prosthetics, as well as in the event of a natural disaster, loss of a home owned by the right of ownership , and similar cases.

“If the issue of the II stage is not resolved in the Seimas of this term, I have no doubt that the next Seimas and the other ruling majority and the Government will do it – it is necessary to correct the injustice,” said V. Blinkevičiūtė.

Mindaugas Lingė, the chairman of the Seimas Budget and Finance Committee from the Homeland Union-Lithuanian Christian Democrats (TS-LKD) faction, said that similar poll trends were already visible last summer. They showed that about 90 percent would like to leave Tier II.

“People’s desire to dispose of their funds more freely when saving for a pension is understandable, but we have a starting point from the Constitutional Court (KT) not even one explanation.

First we had a CT clarification on auto-enrollment. It was not found to be unconstitutional. We also have a second explanation, that there must still be an opportunity to leave, under certain important circumstances”, pointed out M. Lingė.

In his opinion, the most important thing is to improve the system in the directions of CT interpretations.

“On auto-enrolment, I think the procedure could really change: people who opt out once shouldn’t be automatically re-enrolled a few years later. <�…>. If a person has already expressed a position once that he does not want to participate, it should be respected,” said M. Lingė.

According to the chairman of the committee, the Ministry of Social Security and Labor has planned to submit such changes to the Seimas.

“About 25 percent (withdrawal before retirement age) the general principle is this: we must not forget what the system was designed for. It was created not for savings purposes, not as a deposit in a bank account, but for retirement needs after reaching old age. Due to the challenges related to the demographic situation, as the population ages, the birth rate decreases, and the trend changes, when the number of people who work little is supported by more people of retirement age, when the question of accumulation is becoming more and more relevant, a system was created that would serve the need for a pension,” pointed out M. Lingė.

The politician notes that social democrats question the second tier system in principle.

“Surveys are being organized now, and ways to confirm that are being sought,” remarked M. Lingė.

The member of the Seimas gave the example of Estonia, according to him, after liberalization, allowing to opt out, all that was accumulated for pensions increased short-term consumption.

“All that was created as a pension system and should be maintained as much as possible to serve those purposes. <�…>. Otherwise, we will have other coded social problems as a lack of income: after partial withdrawal and consumption, the problem will not disappear anywhere, people will receive smaller old-age pensions and then face social challenges”, commented M. Lingė.

According to the parliamentarian, a frivolous decision to demolish can program social tensions in the future.

“We must distance ourselves from such electoral temptations. It is not difficult to destroy in a short time what was created for decades as a long-term measure, but when nothing is created that is sustainable and ensures people’s social security in the future, it would not be a responsible decision,” said M. Lingė.

According to him, in implementing the CT resolution, the Seimas needs to define the cases that are considered important circumstances and when a certain part of the accumulated funds can be withdrawn to meet the needs.

“The gate must not be wide open, as the system of state incentives was aimed at encouraging savings, however, this is not a simple issue. The money from the state budget, which we contribute to the accumulation, was not intended to meet short-term consumption needs”, explained M. Lingė.

Vilnius University professor Romas Lazutka said that the results of his survey did not surprise him.

“There’s already been all kinds of isolated reactions where, say, you’re on a show somewhere that people can call. There is a negative attitude. <�…>. I have published my article that this stage II has failed. It seems to me that everything is confirmed”, said R. Lazutka.

At the same time, he suggested to look more closely at the experience of other countries.

“We know that about 25 years ago <...> in those countries that were the first, namely Hungary, Poland, Estonia, and were presented as an example for Lithuania, results appeared. Those results are unacceptable to societies. They are only acceptable to pension fund managers because they get handsome profits from this. It’s just very strange that politicians are seduced and the whole system is still being patched,” said R. Lazutka.

The economist also recalled that last year, about two-thirds of the newly automatically enrolled people used the option to opt out of Tier II during the first half of the year.

“It will probably be the same this year. The survey only confirms that”, thought R. Lazutka.

KT has stated that the Pension Accumulation Law provides for a limited possibility to withdraw from pension accumulation funds in violation of the Constitution.

According to economist R. Lazutka, the decision of the Supreme Court is controversial.

“They decided that there must be an opportunity for people to leave, but they did not distinguish between two things. One is monthly installments. The second thing is participation, even if you do not pay contributions.

For example, if a person no longer works, he no longer pays contributions. <�…>. But he participates because his money is there, it is invested further. <�…>. Withdrawal would be very different in each case,” said R. Lazutka.

He thought that it would be very difficult for the government – either this one or the other – to solve this issue.

“I am already hearing hints that the Seimas can use its right to appeal to the CT again with a request to clarify the interpretation,” said R. Lazutka.

The economist explained the difference in situations through examples. For example, a person suffering from a terminal illness in a severe stage who is facing financial challenges would fall into one of them, and it would make sense for him, as R. Lazutka thinks, to take the entire amount.

Another situation would be someone who is facing temporary financial difficulties, say one family member has lost their job, following a divorce.

“It may be a temporary difficulty, and that person may be able to participate again in a year or so. It is important for him not to pay contributions now, and it is not necessary to take the money lying around,” R. Lazutka explained.

It seems to the economist that it would not be fair if politicians tried to name specific diagnoses or other reasons when a person could withdraw money and stop paying contributions.

“That would be a very inappropriate decision, because the situation of sick people can be very different. <�…>. There are people who are seriously ill, but their financial situation is not bad at all. <�…>. Another thing is when he has trouble paying the premiums because his income is very low. It would be an appropriate definition if it were called that “a person lacks funds”, R. Lazutka thought.

However, he pointed out that each such case should be checked.

“That would be a very big administrative burden,” stated R. Lazutka.

As already announced, the Constitutional Court decided that the Pension Accumulation Law provides for a limited possibility to withdraw from pension accumulation funds in violation of the Constitution. And according to the institution, different types of benefits based on the amount of accumulated assets do not violate the basic law.

“The possibility for people to terminate the pension accumulation contract for important reasons, which is not provided for in this law, is against the Constitution. In this way, the property rights of the pension fund participant are restricted”, stated Gintaras Goda, chairman of the CT.

KT notes that the right to funds accumulated in pension funds is related to the protection of his property rights, therefore the current regulation has no basis.

“<...> there is no reason to claim that such a restriction is necessary in order to achieve a constitutionally important goal – to ensure the largest possible number of pension accumulation participants a higher income in old age”, states KT.

“<...> such legal regulation restricts a person’s property rights more than is necessary to achieve the aforementioned constitutionally justified goal, and thus violates Article 23 of the Constitution, which enshrines the inviolability and protection of property, the constitutional principle of proportionality – one of the elements of the constitutional principle of the rule of law”. – is noted in the explanation.

Thus, the CT indicated that the reasonableness and expediency of determining the amounts of assets accumulated in the pension fund and the amount of pension payments depending on them is not a matter of constitutional control, because there is no reason to claim that such legal regulation obviously negates the values ​​it defends and protects, enshrined in the Constitution.

39 opposition members of the Seimas submitted to the CT to examine the conformity of the Pension Accumulation Law with the Constitution. They questioned the constitutionality of the law, as it does not provide for any option to opt out of pension accumulation in pension funds. They also raised the question of whether the possibility of a pension fund participant up to 12 months. suspending participation in pension accumulation, changing the pension accumulation company or pension accumulation fund corresponds to the individual’s right to dispose of his property.