STA, 10 June 2019 - Coalition partners and ministers agreed at Monday's summit that healthcare and the pension system would be the priorities of Slovenia's budgets in 2020 and 2021. Each will get EUR 200-300 million more annually.
Nevertheless, Finance Minister Andrej Bertoncelj said as he spoke to the press after the Brdo pri Kranju meeting the budgets would still be in surplus.
The coalition and government partners met to agree further steps in planning the budgets for the coming two years.
The government is due to send the draft budgets to parliament by 1 October based on a budgeting decree which was passed in April.
The decree caps expenses for 2020 at EUR 10.45 billion, whereas for 2021, they can be a bit higher, at EUR 10.50 million.
Bertoncelj said he had presented the planned revenue and the spending ceilings for the state budget, the health and pension purses as well as for local government.
He expects the government to meet for its first session dedicated to the budget on 4 July, by when the ceilings for individual budget users should be ready.
Although he does not expect everyone to be happy with the distribution of funds, Bertoncelj intends to insist on the ceilings set in April, since this would keep the budgets within the fiscal rule.
The coalition also agreed to have the budget surplus at around 1% of the country's GDP, while Bertoncelj would also like to cut pubic debt to 65% and 61% of GDP, respectively, with a view to have a structurally balanced budget by 2022.
"The budgets for the next two years will have to be within this framework, and we committed to it today," he stressed.
The budgets will be drafted on the basis of the government's macroeconomic forecaster IMAD's outlook, which puts Slovenia's growth for 2020 at 3.1% and at 2.8% for 2021.
Bertoncelj pointed out Slovenia's GDP growth was now double the eurozone average, and its public debt was being reduced the fastest among all eurozone members.
Health Minister Aleš Šabeder, on the other hand, presented the situation in healthcare, noting the priorities were a long-term care bill, improving the management of medical organisations and reducing waiting times.
Happy the healthcare system can count on an additional EUR 400-600 million in 2020-2021, he said the funds would have to be spent in line with the priorities.
"All resources on the market will probably have to be identified and a decision made on how to involve them in cutting the long waiting times," said Šabeder.
Prime Minister Marjan Šarec agreed, but was quick to add this should not be a cover for "permanent privatisation" of the healthcare system.
Šabeder stressed the long waiting times would first be tackled where they were the severest, announcing the first pilot project for orthopaedics.
He, however, admitted his ministry was just starting to tackle the issue, stressing waiting time records would first have to be sorted out.
Šabeder believes more funds would have to be provided to finance not just individual doctors but entire teams of doctors and nurses to cut the waiting periods.
He said the bill on long-term care could be adopted by the end of the year, but noted it was too early to discuss funding, as several scenarios were still being studied.
The coalition partners were generally happy with the summit, with Defence Minister Karl Erjavec, the leader of the Pensioners' Party, saying the budgets should make it possible to meet the country's commitments to NATO and to raise pensions.
Šarec, on the other hand, said names of Slovenia's possible candidate for the European commissioner had not been discussed.
STA, 25 April 2019 - The opposition Democrats (SDS) filed into parliamentary procedure on Thursday a bill on the creation of a demographic fund to prop up the pension system. In line with the proposal, all of state assets would be transferred to the fund, which would mainly finance pensions.
SDS head Janez Janša called on all parliamentary parties to add their remarks. The only point the SDS will insist on is the transfer of all state assets onto the fund, he said.
Otherwise the arguing over which assets should be transferred to the fund will go on forever, he said.
The aim of the bill is to improve the financial situation of pensioners, which is currently below the level of Slovenia's development, and lift the pressure off employers and employees, who have to pay increasingly high contributions to the pension fund to keep the pension system sustainable.
He noted that the name National Pension Fund would be more appropriate than the demographic fund.
According to Janša, the transfer of all state assets onto the fund would also facilitate management of state assets, which is currently not transparent because it is divided among several institutions.
The role of the sole shareholder would be assumed by the National Assembly to make sure that the management of state assets would not be "in the hands of those on power."
In line with the SDS's proposal, the current custodian of state assets, Slovenian Sovereign Holding, would be transformed into the Slovenian demographic fund.
All other investments of the state, the pension fund management KAD fund, the real estate investment firm DSU and the Pension and Disability Insurance Institute (ZPIZ), the public pension insurer, would also be transferred to the new fund.
According to SDS MP Andrej Šircelj, the fund would have a supervisory board and a management.
The supervisory board would have 13 members, put forward by deputy groups. The number of members put forward by each deputy group would depend on the size of the deputy group.
The supervisors would be appointed by the National Assembly with a two-thirds majority of all MPs present.
The management of the fund would consist of the chairman and two members, who would be appointed by the supervisors based on a public call for applications.
Every year, the fund would give 50% of the dividends and rents it would receive, and 10% of all sale proceeds to ZPIZ.
The remaining 50% of the dividends and rents, and 40% of sale proceeds would be accumulated.
The demographic fund would allocate 50% of sale proceeds to the state budget to pay off debts.
The idea of a demographic fund as one of possible instruments to ensure a long-term sustainability of the pension system was floated years ago.
Its establishment was envisaged under the 2013 pension reform of the Alenka Bratušek government and every government since has dealt with the issue.
The current government coalition has also committed to founding such a fund in its coalition agreement. While the Finance Ministry has not revealed when the bill would be ready, Karl Erjavec, the head of the coalition Pensioners' Party (DeSUS), indicated that it might be ready this autumn.
Reacting to the SDS's motion today, most parties said they would study the proposal and respond to Janša's invitations to talks. The ministry, as well, said that it would study the proposal, although it was working on its own bill.
The coalition Marjan Šarec List (LMŠ) and the Modern Centre Party (SMC) expressed belief that any proposal on how to shape the fund would be useful and worth debating.
Matjaž Han, deputy group head of the coalition Social Democrats (SD), said that establishing a demographic fund would be much more than a project of a single party, this government or this coalition. This would be a project of the generation and a topic that must be discussed.
Erjavec meanwhile said that this was an important bill but expressed fear that the motion was politically motivated, adding that if the SDS were serious about it, it would have endorsed a similar bill drafted by DeSUS.
He said he was looking forward to seeing the bill drafted by the Finance Ministry. The ministry meanwhile said the task force working on the bill would model the bill on best practices of similar funds abroad.
All out stories on demographics in Slovenia can be found here
STA, 13 March 2019 - The Ministry of Labour, the Family, Social Affairs and Equal Opportunities has proposed changes to the pension system under which retirement age for persons without 40 years of pensionable service would gradually increase from the current 65 years to 67 by 2034.
Under the current legislation, employees who do not have 40 years of pensionable service may retire at 65, but receive lower pensions.
The new proposal raises the retirement age for these persons to 67 years by two months a year until 2034, Minister Ksenija Klampfer said as she presented the proposal to the press on Wednesday.
The condition that a person must have 40 years of pensionable service for old-age retirement under 67 years remains in force.
The pension rate for persons with 40 years of pensionable service is proposed to be increased in six years to 63% of the long-term average wage for both men and women. The current rate is 57.25% for men and 60.25% for women.
An additional 1.25 percentage points will be added to the rate to persons who were on parental leave in the first year of the child's life, said Klampfer.
The higher pension rate will allow for higher old-age, widow, disability and family pensions and compensations from disability insurance, the minister explained.
Retired persons will also be able to continue to work after meeting the conditions for old-age pensions and receive 50% of their pensions for three years and then full pension after that, with some safeguards being in place.
There will be certain conditions for this right to be exercised, including that contributions for social security have been paid in full, Klampfer said. At present, pensioners who continue working only get 20% of their pensions.
The proposal follows the solutions agreed on in the coalition agreement, said the minister, noting that in 2025, pensions of persons with 40 years of pensionable service would be by 8% higher on average.
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STA, 21 August 2018 - The incoming government coalition is planning to upgrade the pension system and shore it up with a demographic fund in order to make it financially sustainable in the long run. Unofficial information obtained by the STA also indicates the partners plan to raise pensions and welfare benefits.
STA, 13 June 2018 - The OECD has proposed that Slovenia undertake a comprehensive tax reform in order to strengthen its resilience in the face of mounting demographic challenges. The centrepiece of the proposal is a reduction of the tax wedge offset with higher income tax and an expansion of the tax base.
STA, 23 May 2018 - Slovenia was urged to make responsible fiscal policies and continue reforming its health and pension systems as the European Commission presented its spring recommendations for member states in Brussels on Wednesday. The Commission also called for privatisation to continue as planned.
STA, 18 May 2018 - Population ageing is a major topic of the campaign leading up to the 3 June election. While parties advocate a variety of solutions to make the country's pension system sustainable, most of them would encourage pensioners to remain an active part of the labour force longer.