WARSAW Aug 18 More than 2.56 million of Polish
workers opted to continue saving for retirement partly through
private pension funds, social security unit ZUS said on Monday,
giving an indication of the cash funds will have to invest in
the stock exchange.
A law passed last year aimed at keeping Poland's public debt
within the government's own limits gave 16.7 million people the
choice of staying with the pension funds, known as OFEs, or
having all their fees diverted to the state-run scheme.
Critics say the changes amount to nationalisation and warned
they will cap stock market growth, hurting the economy's
long-term prospects. The central bank warned last year that
related changes might also hurt the corporate debt market.
Workers had to inform ZUS that they wanted to stay in their
OFE by the end of July, with those who failed to do so moved by
default. The social security unit said on Monday that around 15
percent of them had chosen OFEs.
A ZUS spokesman declined to say whether the number was in
line with the institution's expectations. The Ministry of
Finance said it would decide whether to comment on the final
The number of people who decided to stay with their private
pension funds may be an indicator of how much money funds will
be investing on the Warsaw bourse, already hit by the pension
Share trade volume on the Warsaw stock exchange fell by over
a fifth in the second quarter from the previous three months, to
below 47 billion zlotys.
Introduced 15 years ago to complement the ZUS scheme, which
continued to collect most Polish employees' pension savings,
OFEs invest their cash in government bonds and local stocks.
After amassing around 300 billion zlotys ($96 billion) for
long-term investment, they became key market players, especially
for the Warsaw bourse, the biggest in the European
Union's emerging east, whose expansion they helped to fuel.
ZUS does not invest for its future pensioners.
But since funds held by OFEs are state-guaranteed, they also
add to Poland's public debt, which last year came close to
reaching the limits set out in the country's constitution.
Facing an economic downturn, the government made OFEs
transfer all the treasury bonds they held - around half of their
assets - to ZUS last year and passed a law requiring pension
savers to say if they wanted to keep investing in the funds.
The Finance Ministry has said the change was necessary to
keep the Poland's public finances on a stable footing.
It helped cut Poland's public debt by about 7 percent of
gross domestic product and will make it easier to keep the
budget deficit below the EU's 3 percent of GDP ceiling in 2015.
(1 US dollar = 3.1269 Polish zloty)
(Reporting by Marcin Goclowski; Editing by Alison Williams)