Polish parliament will make sure reform works for pensioners-lawmaker
WARSAW, Sept 19
WARSAW, Sept 19 (Reuters) - Poland's parliament, which is due to discuss a hotly-contested pensions overhaul, should ensure that people who want to keep pensions in private funds can do so safely, a senior lawmaker said on Thursday.
Financial firms, some politicians and many of those paying into the system have objected to government plans to greatly limit the role of private funds and to transfer many of the assets they hold - notably government bonds - to the state's balance sheet.
Dariusz Rosati, a former central banker and now head of the public finance committee in the lower chamber, said the pension funds had many flaws but the system could be repaired.
Once fixed, the private funds could offer future pensioners benefits in the form of investment diversification.
"OFE (the private pension funds), if their fees are reduced, external benchmarks for investments are set and the safety of the gradual transfer is guaranteed, will be a beneficial addition to the main pillar of the pension," Rosati told daily Rzeczpospolita in an interview.
Warsaw will also give Poles the option to move away from the private funds in the future. The government hopes at least half will choose the state-guaranteed fund ZUS.
Critics of the reform say the motivation is to nominally reduce government debt to allow scope to boost the economy through government spending.
Rosati said parliamentarians will want to take another look at the system as a whole and at the government's proposals but thought the overhaul, even without modification, would easily be passed.
"This is a matter around which there are different opinions even inside the Civic Platform party whose electorate is attached to the pension funds, but there won't be a political problem in passing the law," he said.
No date has been set for parliament to discuss the pension overhaul but the debate will probably take place within the next few weeks.
Markets initially plunged on the news of the overhaul earlier in September, especially the Warsaw bourse which is heavily dependent on the private funds which are its key investors.
But since then, Poland's stocks, bonds and the zloty have recouped their losses, helped further after Wednesday's decision of the Federal Reserve not to cut back its stimulus policy yet.
Ratings agencies also calmed investors saying the government's move was neutral for the country's credit assessment.
For a TAKE A LOOK - Poland overhauls pension system (Editing by Ruth Pitchford)