The Institute of Public Finance, in collaboration with the Friedrich Ebert Foundation, organized on 6 November virtual Public Sector Economics 2020 Conference – The State and Perspectives of Pension Reforms. It was opened by Zdravko Marić (Minister of Finance), Ante Žigman (President of the Management Board of the Croatian Financial Services Supervisory Agency), Judita Cuculić Župa (Senior Adviser at the European Commission Representation in Croatia), Petar Vlaić (President of the Association of Croatian Pension Funds Management Companies and Pension Insurance Companies) and representatives of the organizers.

 

Numerous foreign and domestic scientists and experts participated in the conference, and invited lectures were given by Axel Börsch-Supan, Director of the Munich Center for Economic Aging (MEA), Max Planck Institute for Social Law and Social Policy, and Monika Queisser, Head of Social Policy Unit in the OECD Directorate for Employment, Labor and Social Affairs. The goal of the conference was to take stock of the current state of pension systems around the world and provide a state-of-the-art assessment of the need and room for future reforms in a world of profound demographic, labour market, political and technological changes.

 

Monika Quisser analyzed the reform trends in OECD countries and pointed out that the timing of reform implementation seems crucial. As recent trends she mentioned rising retirement age, but less than life expectancy, declining replacement rates (the share of the average pension in the average wage), and automatic adjustment mechanisms to foster financial sustainability. She concluded that due to the growing pressure on public finances and the development of new forms of work, the pressure on the implementation of pension reforms will increase.

 

Axel Börsch-Supan emphasized that all countries are different and therefore there is no single reform model. The most important question is how to reconcile the financial sustainability and adequacy of pensions. Population aging is a major challenge, but certain solutions for pension systems still exist. It is important to separate individual reform goals and introduce automatisms in the pension system, e.g. to adjust the retirement age to life expectancy. He emphasized that the issue of poverty must not be neglected in pension system reforms; he mentioned that the Croatian pension system is financially sustainable, but at the same time the poverty rate is high. Since it is very likely that fertility rates will not increase in the next 20-30 years, it is necessary to invest in the quality of the workforce, i.e. in the education system.

 

The conference was supported by the European Commission, Raiffeisen Mandatory and Voluntary Pension Funds Management Company, Raiffeisen Pension Insurance Company Plc., PBZ Croatia Osiguranje Plc. - Mandatory Pension Fund Management Company, Croatian Financial Services Supervisory Agency, Association of Cities in Croatia, and the Association of Croatian Pension Funds Management Companies and Pension Insurance Companies.

 

Authors' and keynote presentations are available on the conference website, and selected papers will be published in the Public Sector Economics journal.