13 December 2019
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In the near future Slovenian politicians will have to deal with a major task: a comprehensive reform of the pension system as the current one does not take into account the aging population. The Institute for Strategic Solutions (ISR) believes the necessary reform could be an opportunity for the state to implement solutions that will address the needs of all generations, not just the elderly. The ISR highlights five demographic challenges that should be considered by the decision makers when seeking solutions in this area.

One of the key tasks awaiting the next Slovenian government will be a reform of the pension system. Similar to most of the EU countries, Slovenia is considered to have an increasingly aging population. This means that in the future, with an increasing number of pensioners, measures will need to be introduced to ensure there is a sufficient number of people in work force. OECD pointed out that Slovenia also needs a comprehensive tax reform that will take into account the costs increase to cover for the new pension system. The organisation emphasised that Slovenia needs to prepare itself to work longer in the future.

“The prognosis that the current EU ratio of four workers per one retiree will decline by 2060 to two workers per one pensioner, raises the question of sustainability of the current pension systems. The key question is how the companies and individuals will be able to finance a good-quality and secure retirement,« says Maja Krumberger, President of the Slovenian Insurance Association.

Tine Kračun, director of ISR, says the aging of the population brings many challenges for which our society is not ready. »At the same time, however, these are the opportunities that we must use,” he adds.

Within the framework of a project called the Challenges of the Future that involved experts and people from different demographic groups, the ISR identified five challenges and four scenarios that provide possible solutions to the issue of changing demographics.

The following are the key findings:

  1. The link between the aging population and the economy: demography is the most important factor in the stagnation of national and global economies.
  2. Politicians must not neglect the impact of demography on the economy and society as a whole: aging society brings new challenges as well as opportunities.
  3. Including older workers in the labour market must become an established practice: more older workers need regular income as they do not have enough savings or a sufficiently high pension to support a decent life in old age.
  4. A comprehensive pension reform is needed as the aging of the population is increasingly burdening the pension fund: the reform must focus on strengthening social security while at the same time there has to be an initiative to promote awareness that a secure retirement, to a certain degree, is a responsibility of the individual.
  5. The aging of the population also presents a challenge for the health system: the current regulation of the health care system in Slovenia is not optimal as it does not prioritise the patient.
Adriatic Journal

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