Polish financial sector in the transformation period: pension reform and pension funds development
Polish financial sector in the transformation period: pension reform and pension funds development

Summary/Abstract: The new architecture of the Polish retirement system implemented since 1999 is based on the principle of multiple sources and forms of financing of future pension income that are commonly referred to as pillars. Some of them are compulsory and thus are part of the public pension assurance system, and some are optional but their product is defined by the State. In the World Bank’s nomenclature, the obligatory part constitutes the first pillar of pension assurance. In the case of Poland, this pillar is composed of two totally different parts: a repartition component administered by ZUS (Social Security Office), and a fully funded component administered by open pension funds that are managed by PTEs (pension fund companies). Currently, the pension contribution transferred to the account of the Social Security Office constitutes 12.22% of the gross salary, whereas 7.30% is allocated to the open pension fund account. It should be remembered that apart from that 2.45% of the gross salary is allocated to the ZUS account in respect to sick-leave benefits and 2,0% in respect to accident benefits. Additionally there is also a contribution of 13% in respect of a disability pension. To have a full picture, it should be added that those contributions are made by employees and employers in different proportions.

• Details
• Contents