Wednesday, 18 July 2018

Next labour minister to focus on pensions, welfare system

ČTK |
8 December 2017

Lany, Central Bohemia, Dec 7 (CTK) - Changes to the pension system and a check of the welfare benefit system will be Jaroslava Nemcova's (ANO) priorities after her appointment as new Czech labour and social affairs minister, she told journalists after meeting President Milos Zeman on Thursday.

She said they agreed on the ministry's priorities.

Nemcova said Prime Minister Andrej Babis (ANO) is to inaugurate her as minister following his cabinet's appointment on December 13.

Babis previously said a pension reform is one of the priorities of his nascent cabinet.

He said a special account should be separated from the state budget for pension contributions to be sent to and paid from.

This would make it sure that money for pensions will be available even in periods when the Czech economy will not fare well, Nemcova said.

The Czech Republic has not has any separate pension account so far, and people's contributions to the pay-as-you-go pension system flow to the state budget. For a number of years now, the revenues from their contributions have been lower than the sum spent on pensions.

Nemcova said the new government of ANO wants to start a genuine pension reform including a "regular pension indexation." It will require a broad political and social support, she said.

The present law anchors an annual indexation of pensions as of January 1.

Nemcova said some changes can be made quickly, such as a 1,000-crown increase in the monthly pension of people over 85 and a change in the base pension calculation method that would benefit seniors with low pensions.

The ministry will also check the welfare system and the effectiveness of the benefits introduced in recent years.

The system must prevent people from drawing the state aid automatically and it must make it advantageous for people to work, Nemcova said.

She also wants to negotiate with the Finance Ministry on raising the sum earmarked for social services, she added.

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