Macedonian government struggles to fill pensions black hole
Macedonia’s cash-strapped pension system needs thorough reforms as the financial hole in the state pension fund has been constantly rising over the years, reaching 4.5% of the country’s GDP.
The state-run Pension and Disability Insurance Fund (PIOM) is now in critical financial condition, mainly due to the populist measures taken by the previous government of the conservative VMRO-DPMNE party, which lowered contributions and constantly hiked pensions to secure the support of older Macedonians.
VMRO was eventually forced out of power following mass protests and unrest culminating in a violent invasion of the parliament by its supporters in April 2017. The new government led by the Social Democratic Union of Macedonia (SDSM) now faces the challenge of replenishing the fund and ensuring that pensions payments — PIOM needs an estimated €880mn to pay pensions in 2018 — can be covered.
Read More: IntelliNews