An extended session of the Main Board of the Party of Pensioners/Pensioners of Bosnia and Herzegovina (SPU BiH) was held on November 24 in Tuzla, where key issues for pensioners in the Federation of BiH were discussed, including changes to the Law on Pension and Disability Insurance and the broader reform of the pension system.
Pensioner’s request
The SPU BiH announced that they were satisfied because their proposals were included in the draft amendments to the Law on Pension and Disability Insurance of FBiH. The main committee unanimously accepted the proposed changes and requested that they be considered in the FBiH Parliament under an urgent procedure – by the beginning of December at the latest.
As they state, the goal is to provide funds in the 2025 budget for harmonizing pensions with the growth of the average salary and the amount of the consumer basket.
The president of the party and representative in the FBiH Parliament, Dževahid Sokić, was given the obligation to initiate the thematic session of the House of Representatives dedicated to the reform of the pension system and the position of pensioners.
SPU BiH emphasizes that closer cooperation with the Federation of Associations of Pensioners FBiH is necessary, especially in the segments of system reform, improvement of services and health care of pensioners.
Expires
The time is running out for the adoption of the new Law on PIO, a law that could bring about a 17 percent increase in pensions to pensioners in the Federation.
In order for the new calculation to come into effect on January 1, it is necessary for the law to be adopted by the end of the year. Currently, it has not yet been introduced to the parliamentary procedure, which leaves less and less room for this process to be completed on time.
The Federal Minister of Labor and Social Policy, Adnan Delić, explained that everything was done with the aim of pensioners receiving a more significant increase in income compared to the one provided by the existing adjustment model.
A new calculation
He pointed out that the new calculation predicts an increase in pensions of approximately 17 percent. This would raise the lowest pension from the current 599 marks to around 700 marks.
He emphasized that these assessments were made together with the PIO Institute and the Federal Ministry of Finance. They are the only ones authorized to estimate the fiscal amount that such a reform would require.
Delić reminded that this is a large budget intervention that requires stable incomes and political will to improve the position of one of the most vulnerable social groups.
He said that the goal is for the law to enter into force on January 1 of the following year. Thus, the increase would be visible already at the first payments in 2026.
Expires
However, the New Year deadline is fast approaching. The law-making procedure includes several stages.
The law has not been sent to parliament. Even with an expedited procedure, there is very little time left to complete the entire process on time.
As the days pass, it is less and less realistic that the reform will be adopted. At least not within the deadlines previously announced by the Ministry.
What does the announced reform bring?
The new legal solution on pension and disability insurance, which, if the announcements are to be believed, should be adopted by the end of this year, will mean a new calculation of pensions that will bring about a completely new pension adjustment formula.
This implies a combination of the growth of living costs and the growth of the average salary, in a ratio that is more favorable for pensioners; 60% increase in salary and 40% increase in consumer prices.
However, what is particularly important is the fact that the new legal solution creates the preconditions for a long-term sustainable system that will be directly and indirectly linked to the announced major reform of the labor market.
Given that we currently have 1.20 workers per pensioner, things must change in terms of labor legislation as well.
Mediation in employment
One of the solutions that should bring order to the labor market is a new legal solution on mediation in employment and social security of the unemployed, which would introduce a clear distinction between active and passive job seekers, which leads to clearer and more accurate records and directly affects the reduction of fictitious applications on the records of the unemployed.
And when it comes to the new pension growth model, it works in favor of the beneficiaries, taking into account the indicator that is more favorable for pensioners.
“In addition, it was proposed that pensions be adjusted twice a year – at the beginning and in the middle of the year, which is much more favorable and fairer for our oldest citizens,” said federal minister Adnan Delić recently.
A fairer system for future retirees
In addition to the increase in minimum pensions for all existing beneficiaries, the new legal solution also brings a fairer system for future pensioners, one in which the payment of contributions will be stimulated, so in the future the minimum pension will not be the same for those with 15 and for those with 40 years of service.
One of the problems of the existing law is that it indirectly encouraged the “gray market” of labor; people often, after 15 years of service, deregistered either in agreement with the employer or because they had no other choice and continued to work “on the black”, without contributions.
“It is unsustainable and unfair. The new law therefore clearly stimulates formal employment, strengthens the stability of the system and guarantees a secure old age for everyone who regularly pays contributions,” Delić said recently, reports Focus.
