11 Old-age pensions and the insurance system

22 OLD-AGE PENSION is a cash benefit intended as the old-age security for persons who due to their age no longer have the earning capacity.

33 The principle of inter-generation agreement (solidarity) Contributions currently paid by the economically active persons are designated for benefits payment to current pensioners.

44 the DEFINED BENEFIT model to the NOTIONAL DEFINED CONTRIBUTION model After the 1999 reform, the universal old-age pension system was transformed from:

55 Old-age pension amount according to the reformed ("new") rules – in accordance with the principle "my contribution is working for my pension"– is determined by dividing a total amount of pension contributions accumulated on the insured person's account (after their indexation) by average life expectancy

66 My old-age pension 2057 year FIRST PILLAR ZUS SECOND PILLAR OFE THIRD PILLAR IKE, IKZE, PPE 2012 year

77 Why? Decision of Poland Increasing the retirement age to 67 years for women and men

% of population 48.3% of population 14.4% of population 18.7% of population 64.5% of population 16.8% of population million 7.1 million 4.4 million 14.8 million 24.6 million million +5.0 million 6.4 million 11.4 million TOTAL 38.1 million million TOTAL 30.6 million Age pyramids of the Polish population

99 INSURED PERSONS (economically active) ,069, ,601, ,819, ,957, ,395, ,281,000 PENSIONERS 20155,118, ,936, ,610, ,142, ,018, ,914, million number of insured persons in million number of pensioners in 2012

10 Source: Eurostat demographic forecast Projected average life expectancy for "0-years-olds" Average life expectancy for "0-years-olds" - forecast 74,2 75,3 76,4 77,5 78,6 79,6 80,6 81,5 82,4 81,9 82,7 83,5 84,3 85,1 85,8 86,6 87,2 87, menwomen

11 What if we do not increase the retirement age? No changes  drastically reduced pensions and the increasing poverty of the elderly  lower economic growth due to the dropping number of working age population  high deficit of the pension system, limiting development expenditure Increase in contributions / taxes  significantly lower economic growth due to higher labour costs and lower employment  escape of good workers abroad  lower net earnings ("takehome salary")

12 Situation in Europe How other European countries solve problems...

13 Countries, which have increased the retirement age Countries, which have not increased the retirement age but have reached the level of at least 65 years for women and men Countries, which have not increased the retirement age and have not reached the level of at least 65 years for women and men

For women born after 1974 the old-age pension will increase even by 70%. For a woman with average earnings in the national economy. Old-age pension women Average remuneration 1,962 3,400 3, % 1 3, % After changesBefore changes 7,823 2,921 After changesBefore changes 2,062 Average remuneration In PLN, fixed prices, 2011 Old-age pension for a person born in 1973 Women Men Increase of the retirement age translates into the growth of the old-age pensions Source: Estimates of the Ministry of Finance.

15 How to control one's future pension? ZUS Electronic Services Platform, i.e. the first Polish e-office administration systems, allows every person to check, on a current basis, his/her account in ZUS and contributions paid in his/her favour and allows to calculate on this basis the projected future old-age pension. pue.zus.pl

16 How to control one's future pension?

17 How to control one's future pension?