Early retirement is a problem

The average retirement age in Greece is just above 60, the second lowest figure in Europe, according to a recent SHARE survey. As the country holds the same place regarding the average early retirement age (at just above 54) it could therefore be described as a paradise for pensioners but a curse for its pension funds. Yet this is only part of the story, since 19.3 percent of pensioners aged 50-65 are living below the poverty line. The story of Greece’s pension system and the numerous, contradictory legislative amendments made over the past decade show that early retirement is not always a personal choice. Apart from extreme cases (such as that of Emporiki Bank), early retirement is often forced on people as a result of market restructuring and crises in specific sectors. The high incidence of depression among seamen forced into retirement by the shipping crisis of the mid-1980s, at ages when most of them were still very active, is a typical example. Another factor is the insecurity aroused when a new law is in the offing, or if an attractive voluntary redundancy package is provided. Between 1990 and 1994 alone, 20,000 women and 15,000 men took advantage of deals provided for in legislative amendments to social security funds. The trend among civil servants these days is somewhat different. Those who carry heavy responsibilities but whose jobs are not classified as such are encouraged to retire early. A nurse who has the right to retire at 55 will rarely stay on a day later; this also applies to hospital cleaning staff. A glance at retirement applications received by the civil servants’ welfare fund reveals that the number of younger pensioners is declining. On the other hand, the government is under great pressure not to regard 60 as the mandatory retirement age. More and more people want to work until 65, for the simple reason that civil service wages, including bonus benefits, are much higher than what they can expect from a pension. Recently, the number of people forced into early retirement with a lower pension at the ages of 50 or 55 has been rising due to the closure of businesses and to redundancies. In these cases, the staff member pays his or her own pension contributions for another five years in order to acquire the minimum requirement of 100 pension stamps in order to obtain the lowest pension. Those who stand to gain by early retirement are those who joined voluntary redundancy plans at the age of 44 or over. This applies to some 5,000-6,000 staff members of the Hellenic Telecommunications Organization (OTE), while at the National Bank of Greece, 2,800 staff members have accepted voluntary retirement since 1993. Nevertheless, the days are long gone when women bank employees with dependent children who entered the labor market before 1983 retired at the age of 45 with pensions that are now as high as 800 euros monthly. What we will be seeing more of is older women entering auxiliary occupations usually filled by immigrant women.

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