Direct Request (CEACR) - adopted 2011, published 101st ILC session (2012)

Invalidity, Old-Age and Survivors' Benefits Convention, 1967 (No. 128) - Czechia (Ratification: 1993)

Other comments on C128

Direct Request

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Part III (Old-age benefit), Article 18(2) of the Convention. Payment of a reduced pension. The Government’s ninth annual report on the application of the European Code of Social Security indicates that old-age pension is provided to an insured person who had completed a qualifying period of at least 25 years in 2009, which is being gradually increased by one year to reach the target of 35 years after 2018. Since 2010, the minimum insurance period of 15 years required for the provision of an old-age pension for an insured individual reaching the age of 65 is being gradually extended by one year in parallel with the pension age to reach the target of a 20-year insurance period after 2013. In light of these provisions, the Committee requests that the Government explain whether, in accordance with Article 18(2) of the Convention, a reduced old-age pension is paid to insured individuals who reach statutory retirement while completing an insurance period of only 15 years, and which provisions of the national legislation are relevant to this matter of compliance with the Convention.

Part VI (Common provisions), Article 35(1). General responsibility of the State for the due provision of the benefits. The Committee notes the concerns expressed by the Czech–Moravian Confederation of Trade Unions (CMKOS) about the possible negative impact on the application of the Convention of the pension reform measures initiated by the Government. The CMKOS alleges that these measures threaten the long-term financial sustainability of solidarity PAYG system, particularly by diverting part of the insurance contributions from the current pension system into privately funded pension savings. The Government replies in its report that the goal of the reform is not to save on pensions paid in the PAYG system, but rather to diversify risks and to allow for better valorisation of retirement savings through creation of a multi-pillar system which will effectively combine the concept of solidarity pension with capital savings elements. The Committee would like the Government to substantiate this statement by providing actuarial studies showing that the proposed transfer of 3 per cent of the insurance contributions from the solidarity into the private system will not threaten the long-term financial sustainability of the PAYG system and will not result in the reduction of the replacement rate of pensions paid by it.

[The Government is asked to reply in detail to the present comments in 2012.]