Should pensions go private?

A meeting on privately run pension funds was held at the British Embassy this week. The meeting confirmed the intense interest of insurance companies to develop such funds in Greece, but also recorded the intense skepticism of unionists and pension fund employees, who expressed their fears that such schemes could collapse due to bad management and corruption. British speakers focused on the benefits of the system and its development in the UK. There, the government has chosen to focus state aid on the neediest pensioners and encourages the rest to rely increasingly on privately run pension schemes. The British government plans to institute a flexible retirement age. The representative of the Financial Services Authority said there are more than 100,000 occupational pension funds covering some 25 million citizens and managing funds worth 735 billion pounds. Privately run funds, about 500 of them, cover 15 million people and manage about 475 billion pounds. About 60 percent of UK pensioners’ income comes from their state pension, while the rest comes from private pension schemes. Nikos Analytis, vice president of the Federation of Greek Industries, proposed «a flexible system which will provide employees with the opportunity to retire between the ages of 60 and 67.» Giorgos Romanias, representative of the General Confederation of Greek Labor (GSEE) agreed that there should be incentives to stay longer in employment. He mentioned the Swedish system, where retirement is voluntary and there is no maximum age.

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