Private pension funds "can handle payments without any problem"

Private pension funds are very liquid and can handle payments without any problem, including the peaks expected in 10-15 years, when the number of people who will retire will increase significantly, explained the president of the Association for Privately Administered Pensions in Romania, Radu Craciun.

He specified that the new regulations regarding the payment method of private pensions, intensely debated in recent days, were not established for any financial reason, but because they introduce some correct principles that are found in all countries with developed private pension systems.

Radu Craciun: If we look at the year 2025, the contributions that enter private pension funds are somewhere around 22 billion lei. The payments we make today are two billion lei. Of course, it will not remain at this level. In the future, the number of those who will leave will increase. Most likely, the entries into the system, the money entries, will be large enough to satisfy the payments even in that payment peak. At some point, the value of the pension fund assets will reach a ceiling, so they will not increase anymore because /.../ many entries will be payments, but in no case is there a problem of tensions, let's say, or the impossibility of making this payment.

The new bill provides for two forms of payment of private pensions from the second pillar, namely the scheduled withdrawal, which will be paid over a specified period, with the guarantee of full reimbursement of the accumulated asset, and the life pension, with payment throughout the participant's life.

Translated by: Radu Matei