Special pensions to be abolished, state to still pay them for decades to come ({{commentsTotal}})

Special pensions for members of the defense forces, the police, and prosecutors will likely be abolished by the year 2020.
Special pensions for members of the defense forces, the police, and prosecutors will likely be abolished by the year 2020. Source: (mil.ee)

A draft bill by the Ministry of Social Affairs has entered the evaluation stage that aims to abolish special pensions. If passed by the Riigikogu, it would not enter into force before 2020, and its effects would only become visible decades into the future.

The effect of the bill on the state’s finances will only show after two to four decades, as all state employees affected by the bill still have a right to special pensions until the potential new law enters into effect. In practice, they will still be granted for another 30 to 40 years, and paid out for another 70 to 80 years.

The measure won’t influence spending on pensions right away either, as the number of officers entitled to pensions will only start to shrink in 20 to 30 years.

The government agreed to abolish special pensions for members of the defense forces, prosecutors, and police and border guard officials as of 2020 on Jan. 20.

The change concerning special pensions will affect those entering into service into the affected fields as of Jan. 1, 2020. All members of the Estonian Defence Forces (EDF), prosecutors and police and border guard officials currently employed or entering into service before then will retain the right to receive a special pension, spokespeople for the government clarified.

According to Minister of Social Protection Kaia Iva, the situation will become fairer following the reform. She added that in the past, the special pension system was created to compensate for the low wages of public officials, but as the situation has since changed, there is no need to treat people differently today.

The Ministry of Social Affairs is to prepare the draft bill and submit it to the government in April.

At present, a total of 1,800 members of the police force, 750 members of the EDF and 21 prosecutors receive a special pension. In 2015, the average monthly pensions of prosecutors, police officials and members of the EDF were €1,759, €676 and €635, respectively. In comparison, the average old-age pension is €375. Those eligible will begin to receive their special pension after turning 50 or up to 55 years of age; the regular retirement age is currently set at 63.

Editor: Editor: Dario Cavegn

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