Finance Committee amends bill on Demographic Fund

Ljubljana – The parliamentary Finance Committee adopted a series of amendments to the National Demographic Fund bill on Wednesday, mostly based on remarks from the parliamentary legal service. The opposition walked out after its amendments, which would change the basic concept of the fund, were voted down.

The committee members from the opposition Marjan Šarec List (LMŠ), Social Democrats (SD), Left and the Alenka Bratušek Party (SAB) proposed a public debate on the bill arguing that the bill was being passed without debate at the Economic and Social Council, the industrial relations forum, and that criticism by the anti-graft commission and an association of supervisors had been overheard.

But their amendment did not receive enough support to get passed.

Luka Mesec from the Left said the planned fund would not tackle the problem of pensions but primarily enable concentration of state assets, so that the government would have full control. This was echoed by Andreja Zabret (LMŠ) and Marko Bandelli (SAB).

Bandelli said the fund was being set up so that the Pensioners’ Party (DeSUS) will be able to take credit for the project and that the senior coalition Democrats (SDS) would be able to replace all supervisors of state-owned companies.

Jani Prednik, an SD MP, said such an important law should be passed based on a consensus. He believes the bill should be rewritten.

Finance Minister Andrej Šircelj said a debate had been held in parliament as the bill passed first reading and that the proposal had been coordinated with expert groups directly or indirectly affected by the bill.

The proposal was presented on the Economic and Social Council, and five meetings were devoted to the matter, but some partners did not want to talk about articles but only about the bill in general, he said.

According to the minister, the fund is one of the solutions for ensuring sustainability of the pension system in the future given the ageing of the population.

The government believes the centralisation of the management of state assets will make the managing of assets more efficient, so that more money will be available for pensions, family policy measures and the elderly.

Marko Pogačnik from the SDS said centralisation was crucial. The fund will lift the burden off the state budget, which now has to cover for the loss of the pension fund, and it will stabilise the pension system.

Dušan Verbič (SMC) agreed with Šircelj that a broad debate had been held on the bill. He said the opposition did not want any changes to the managing of state assets and that all governments so far had flunked the test on responsible corporate management of state assets.

Jožef Horvat (NSi) noted that a debate on the bill had started about a year ago, when the coalition agreement had been signed. He said a demographic fund should have been founded in 2014 in line with the pension and disability insurance act.

The committee chair, Robert Polnar from DeSUS, said the bill had been filed into parliamentary procedure last October, while the opposition demanded a public debate only now.

He believes the coalition and opposition would never see eye to eye on some issues such as managing of investment, creating additional sources of financing for the fund or the period of accumulation of the funds.

Polnar expects that if passed the bill will probably be put to a referendum. He thinks the proposal would need to be modified in the future to include additional sources of financing, which could include revenue from managing state-owned forests, higher social security contributions or a part of the value added tax collected.

Indeed, the opposition MPs who walked out of today’s session told the press they would seriously discuss options for a referendum. Luka Mesec, the coordinator of the Left, said the details would be presented in the coming weeks and that a referendum was not excluded. Some trade union associations have also mentioned this option.

Mesec said this was one of the most important bills in this government’s term that would decide on the managing of EUR 8.6 billion worth of state assets but other then the finance minister nobody else had been invited to take part in today’s debate.

In line with the proposal, the demographic fund would allocate 40% of dividends form state-owned companies and 40% of the money from the sale of state investments for pensions. 10% of the dividends would go for financing elderly care and 10% for family policy measures.

The fund would be led by a three-member management board that would be appointed by an 11-member supervisory board. Seven members of the supervisory board would be appointed by the National Assembly – five at the proposal of deputy groups, one would be put forward by the Association of Pensioners, and one by the Youth Council – and four picked by the government. The supervisors would have a five-year term with the possibility of reappointment.

Mesec said this showed the government would manage the assets alone. “It will have two representatives of pensioners and the youth there just to look better, but they will have absolutely no influence …” he said.

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