Pension system ended Q1 with CZK 25.7 billion deficit

The Czech pension insurance system ended the first quarter of this year with a deficit of 25.7 billion crowns, the biggest ever Q1 pension system deficit in Czechia, according to the Czech News Agency.

The government has stated that the current pension system is unsustainable and wants to present proposals for its reform this month, including reducing the pension rate indexation. There is also talk of people in physically demanding professions being able to retire early with a full pension, while the retirement age may be raised for others.

Pension spending has doubled over the past 15 years. About 30 percent of state spending will go into the pension system this year. A National Budget Council report on the long-term sustainability of public finances suggested that pension spending could reach almost 13 percent of GDP by 2050.