Bulgarian Cabinet mulls raising retirement age to 65

Written by on March 31, 2015 in Bulgaria - Comments Off on Bulgarian Cabinet mulls raising retirement age to 65

Bulgaria’s Cabinet plans to raise the retirement age in the country to 65, according to a proposal presented by Deputy Prime Minister and Labour Minister Ivailo Kalfin on March 31.

Under this proposal, the retirement age for men would increase by two months in each of the next two years and by one month each year between 2018 and 2029. Women’s retirement age would increase by two months each year until 2029 and then by three months each year until 2037, when the retirement age for both genders would become the same.

Similar incremental increases are envisioned for professions qualified as first- and second-category heavy labour, where the retirement age is set to become 57 years (for first category) and 62 years (for second category).

Currently, Bulgaria has no retirement age for first-category heavy labour ­– which includes armed forces and Interior Ministry personnel, or an estimated 75 000 people – only a requirement for 27 years of work experience, Kalfin said. The average retirement age for such people in 2014 was less 52 years and eight months, he said.

Bulgaria’s pension system has experienced large deficits in recent years, covered by the state Budget, and some economists have pointed out the large number of early retirees, as well as suspicions of wide-spread fraud involving disability retirement, as among the reasons for those deficits.

To raise additional funds for the pension system, Kalfin’s proposal also envisions raising the mandatory pension and unemployment contributions paid by all employees by a total of 4.5 percentage points over the next 12 years.

“I still believe that this is a very smooth transition that can be borne by both employers and employees. I know that there are other proposals and I am prepared to discuss them, but we should be working towards reaching a final decision on this subject,” Kalfin said, as quoted by Bulgarian National Radio.

Prime Minister Boiko Borissov said, at the same news conference, that he would pitch the proposal to his party GERB and secure its support for the plan, while Kalfin would have the same task of persuading his own party, socialist splinter ABC.

Relations between GERB and ABC have been strained lately, with ABC leader Georgi Purvanov hinting that his party could scrap the agreement to back Borissov’s cabinet as early as next month. Should such a scenario come to pass, Kalfin said that he would resign from the government.

(Bulgaria Deputy PM Ivailo Kalfin. Screengrab from Bulgarian National Television)

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