Although the public, when it comes to changes to the Law on PIO in FBiH, the most talked about is the increase in pensions, these changes are also brought by many other news, and one of the most important refers to future pensioners who, for a minimum of 15 years of service, will have far less income than the current beneficiaries of the FBiH PIO Fund.
The FBiH Parliament will soon consider changes to the Law on PIO, which was adopted by the Government of the Federation of BiH. These changes imply another formula for the adjustment of pensions in the Federation of BiH, the application of which will lead to the January pension being 11.6 percent higher, and pensioners will receive another adjustment in July, when the pension should be increased by an additional 5.6 percent.
However, in addition to increasing pensions by a little more than 17 percent, a significant change is also the one that prescribes the amount of pensions for future retirees. This is defined by Article 81 of the amendments to the Law on PIO, which has been completely amended. According to the current Law on PIO, a person who, for example, has 15, 17 or 19 years of service and is 65 years old is entitled to the lowest pension, which is now 599 KM in the Federation of Bosnia and Herzegovina. If the changes to the PIO Act are passed, the lowest old-age pension will depend on the length of the pension period. It will be determined as a percentage of the average pension paid for December of the previous year.
For less than 20 years of pensionable service and 65 years of age, the pension cannot be lower than 60 percent of the average pension. Given that the average pension now amounts to a little more than 650 KM, 60 percent of that amount is 390 KM. Basically, a pensioner who retired in December last year with 15 years of service and 65 years of age will have the minimum pension of 599 KM, and a pensioner who retired in January with 15 years of service and 65 years of age will have a pension of 390 KM.
Further, in the amendments to Article 81, it is stated that for 25 years of pensionable service and more, but less than 30 years, the pension cannot be lower than 70 percent of the average pension, and for 30 years of pensionable service and more, but less than 35 years, the pension cannot be lower than 75 percent. For 35 years of pensionable service and more, and less than 40 years, the pension cannot be lower than 85 percent, and for 40 years of pensionable service and more, it cannot be lower than 95 percent.
“Article 81 of the Law on Pension and Disability Insurance has been completely amended. At the written request of the representatives of pensioners in the FBiH, the currently valid provision of Article 81 has been significantly amended. The protective mechanism of the lowest pension has been retained with significant corrections in the form of multi-level insurance of the lowest amount of pension,” the explanation of the changes to the Law on PIO reads.
Although the explanation of the law states that pensioners requested these changes, Mustafa Trakić, a member of the Board of Directors of the Association of Pensioners, is convinced that Article 81 of the law will not be adopted, stating that the reason for this is the rights of participants in the war.
“You cannot punish someone who participated in the war. After the war, no one could get a job for five or ten years. So how are you going to punish him? It is certain that articles 79 and 147 of the law, which refer to the adjustment of pensions and the payment of death benefits, will be adopted. Article 81 must go into the regular procedure. That will not pass, there is nothing to be gained from it,” said Trakić recently.
The Federation of Independent Trade Unions of Bosnia and Herzegovina is also against these changes, where they say that the Trade Union did not participate in the drafting of changes to the law in connection with Article 81.
“I will be at the session of the FBiH Parliament and I will react because we should have participated and we should have been at the Economic and Social Council. Amendments to Article 81 are unacceptable for us, it is not right that pensions should be lower in the future,” said Samir Kurtović, president of the Federation of Independent Trade Unions of BiH.
In addition to harmonizing pensions and amending Article 81 of the PIO Act, the newspaper also refers to who can collect death benefits after a pensioner’s funeral. According to the current article of the Law on PIO, immediate family members, husband, wife and children have the right to death benefits. With the amendments to the Law on PIO, it will be possible to collect death benefits from persons who are not family members, but have paid for the burial costs. Also, pensioners who receive a pension through the Federal PIO Institute and live in the territory of Republika Srpska could not exercise their right to a death benefit, which has also been changed.
Nermin Nikšić, Prime Minister of the Federation of Bosnia and Herzegovina, said that social benefits and pensions are a priority of the Government of the Federation of Bosnia and Herzegovina.
“A 17 percent increase in pensions is planned, starting in January, after the adoption of the law that is currently in the parliamentary procedure. The minimum pension would increase from 600 to 700 KM with this increase. In practice, this means that pensioners with minimum incomes in one year will receive an amount corresponding to the value of 14 current pensions for 12 months. This is one of the most financially demanding laws at the FBiH level. We planned for that law in the 2026 budget 4.3 billion KM”, Nikšić said yesterday, as reported by Faktor.
