2.45m Poles opt into private pensions
August 13, 2014
A total of 2,449,099 Poles had submitted requests as of August 11 to continue to transfer a portion of their social security premiums to private pension funds (OFEs), the state social insurance board (ZUS) said Tuesday.
On August 11 alone, the daily inflow of submissions decelerated to 107,000 from the August 7 peak of 142,000, suggesting that the number of submissions being processed by ZUS may soon decline to marginal levels.
Poles had to end-July to opt into the existing system by which a fraction of social security premiums are transferred to privately managed pension funds. Poland made the system optional, requiring registration for those who wished to remain in the system.
At the end of June, only 385,100 working Poles had opted into the scheme—just a fraction of the 16.7 million Poles who own such pension funds under the previously mandatory system.
Poles saved the decision for the last moment after a very lackluster start to the four-month period they were given to make their choice. Only 385,000 signed up in the first three months, but starting filing at or above 100,000 daily in the last week of submissions.
Poland has been transferring a portion of the social security premium of younger workers to their private pension fund accounts since 1999, when the social security system was partially privatized. ZUS will continue to transfer 2.92% of gross wages to OFE for those who decide to stay in the system.