Five-year pension plan

It will take up to five years for the government to fully implement its pension reform plans, which will involve more than 150 funds being merged into five or seven groupings, sources told Sunday’s Kathimerini. Anyone retiring during this five-year period will not see the level of their pension affected by the changes to the system. In fact, it is thought that the level of retirement pay that pensioners receive will not be affected until 2020, according to government sources. The ruling conservatives had indicated they wanted to merge all the pension funds into just five but this number may eventually rise to seven. The reform plans have met with strong opposition from unions, which have called a 24-hour general strike for Wednesday, fearing that New Democracy is using the reform process as an opportunity to trim pensions. However, government sources insisted that the changes will be implemented gradually and that pensioners will not feel any financial pinch. The conservatives believe that the merging of the funds will immediately save 800 million euros and will mean that the number of fund management personnel will be cut from more than 1,000 to around 150. Two other areas where the government will seek to cut spending and streamline the system are early retirement and jobs classified as «hazardous and unhealthy.» People employed in the latter category enjoy certain pension benefits that conservatives believe are, in some cases, excessive. Currently, 537 professions are classified as hazardous and unhealthy and the government wants to split them into four tiers so that they do not all have the same benefits. The government also believes that the framework for early retirement places too much of a financial burden on the pension system. So, the conservatives are thinking of preventing people who have worked for 35 years from claiming a full pension when they are 58 and increasing the age limit by two years. They are also looking at changes to the rules that allow mothers to retire at 50 or 55 and replacing it with other benefits such as 12 months’ paid leave for young mothers.