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Labour Minister Jurecka Presents Initial Details Of Pension Reforms

CZECHIA

Czech Minister of Labour and Social Affairs Marian Jurecka held a press conference to unveil the details of the first package of pension system reforms designed to reduce fiscal deficit.

  • Per a Seznam Zpravy summary, Jurecka announced that there will be tweaks to the mechanism of automatic pension hikes, as the current system is too costly and favours high-earning pensioners. The government will also seek to reduce incentives for people to opt for early retirement.
  • "We are facing the challenge of the sustainability of the pension system. If we did nothing, the pension system would have to be financed by an amount that would exceed 300 billion crowns," Jurecka said.
  • The government is looking to introduce the first package of reforms in May. The legislative proposal is currently consulted with various departments and will be later discussed with the opposition, with Jurecka pointing to room for some minor adjustments.
  • The reforms are part of the government's plan to reduce fiscal deficit which grew substantially during the pandemic era. CNB's Jan Kubicek recently said that "if the fiscal deficit isn't somehow reined in, monetary policy will need to be tighter."

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