The reform of the Macedonian pension system is about to reach its final stage. With the Law on Voluntary Fully Funded Pension Insurance, passed in January 2008, the third pillar of the pension system was introduced.
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The Project of the Foundation Open Society Institute of Macedonia for Assessment of the Good Governance Potential in the Republic of Macedonia for the first time this year organized a competition for good governance awards. | | |
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What are the changes in the pension system?
Under the current pension system, the employer pays 21.2% of each employee's salary to the Fund for Pension and Disability Insurance of Macedonia – PDIF. In the reformed system the same contribution will be paid. What is new is that two private pension funds have been established, and for employees who become their members the pension and disability insurance will be covered by both the PDIF and a private pension fund. This is the two-pillar pension system. The total of 21,2% contribution is divided into two parts: 13,78% will remain in the PDIF and 7,42% will be transferred to an individual account in the chosen private pension fund. The contribution paid to individual accounts will accumulate and increase by earning an investment income. | | |
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