Government to abolish special pensions by 2020
The government decided in Thursday's cabinet meeting to abolish special pensions for members of the defense forces, prosecutors, and police and border guard officials by 2020.
“The government's consensual decision is revolutionary. Several earlier governments argued about this reform for years but without results. Now the final decision has finally been made,” Prime Minister Taavi Rõivas (Reform) was quoted in a press release by the Government Office on Thursday.
The decision concerns people who enter into service after Jan. 1, 2020. All present members of the defense forces, prosecutors, police and border guard officials as well as all those who enter into service before Dec. 31, 2019 will still get a special pension based on the rules in effect today.
In the opinion of the Ministry of Social Affairs, reforming special pensions is necessary because although they were created as a staffing policy measure, studies show that these are only the sixth highest motivator for people to enter into the services concerned.
In addition, special pensions do not fit in well with the three-pillar pension system, as these former service members receive a special pension as well as a second-pillar pension that may amount to an even higher sum than the person’s previous salary. At the same time, what regular pensioners get amounts to around 40% of their previous salaries.
At present, 1,800 members of the police force, 750 members of the defense forces, and 21 prosecutors receive special pensions. Last year, the average pension of a prosecutor was €1,859, that of a police official €676, and that of a member of the defense forces €635. The average old-age pension is €350. Special pensions are paid after comparably early retirement as well, starting at age 50 to 55, while the regular retirement age is 63.