At this Stage we have Pension System Reform Regulations, but We do not See Specific Steps

The country has met the process of pension system reformation unprepared, Zurab Lalazashvili, a managing partner for BDO, noted. The pension agency must be staffed with qualified specialists to successfully implement the reforms, he said.

Our people should make sure that their savings will be managed reasonably, they will receive benefits and their savings will not be lost in a long-term perspective.

“At this stage we have regulations, but we do not see specific steps. Therefore, it is difficult to make conclusions. The process may be developed very well. Let’s see what happens. However, I would also like to note that technical problems have already appeared. Prior to system enforcement, I was saying that we had a situation we were unprepared for. Neither infrastructure nor people were prepared. And they were assuring us that everything would work”, Lalazashvili noted.

The regulation should include a formula for calculating pension savings, he added. “There is an entry and under the regulation, pension fees must be paid, and all sources that are identified as salaries. But there are cases when the issued money  did not represent  benefits of this nature, but they are identified as benefits anyway. Similar cases are taxed by income tax, and legislators have affixed pension fees to the income tax. As a result, we have received many cases  that seem unjust”, Lalazashvili noted.

In response to the question of whether the country has met the new pension system reforms unprepared. Lalazashvili goes on to explains that the idea of creating the pension fund is right in itself, because it can bring positive economic results in the long-term perspective. Despite this, it should be noted that the current situation in terms of pension system reform, leaves the impression that the country has reached this step unprepared, he added.