First non-state retirement scheme approved by CNPF

The Board of the Financial Market's Commission (CNPF) has approved the pension plan “Victoria Rational” meant to offer retirees an alternative to government-paid age pensions, Info-Prim Neo reports. Addressing the Economic Press Club on Tuesday, Alexandru Zgardan, pension fund director at the insurance company Victoria Asigurari, said that at the first stage the pension plan will be available to corporate clients only. Individuals will be able to gain membership in the fund starting 1 January 2009. “Until recently, there has been no possibility in Moldova to obtain a non-state pension, which would be a supplement to the retirement annuity guaranteed by the government. The demographic situation calls for such a solution here in our country, as well as in other European countries where the number of the elderly is continuously growing, while the contribution of the working population is no more sufficient to ensure a decent living for the elderly”, said Zgardan. The minimum amount of money that must be contributed to the plan by a member is 100 lei, with no maximum limit fixed. This is to offer greater flexibility, the company says. Yet, the national legislation stipulates a maximum of 15 percent of the income. Among the advantages of the scheme, Zgardan mentioned the tax exemption on the amounts contributed to non-state retirement funds, guaranteed payout of the deposited funds plus dividends on investments, the safety of the contributed money, etc. Corporate clients can use this solution to enhance the attractiveness of their salary packages. A foreign company dealing in Moldova has already voiced its readiness to become a Victoria Rational client, announced Zgardan. Victoria Rational will invest the funds deposited by the clients over a period of two years in state securities or will further deposit the money with banks. The invitees at the Economic Press Club revealed that other non-state pension funds are soon expected to join the market. Veaceslav Ionita, an expert with IDIS Viitorul, said that another 5 or 10 years have to pass before non-state pension funds can convince the populace that the government-paid pensions, which make up a mere 27 percent of the average monthly salary in Moldova, cannot afford a decent living.