The new pension reform in Bulgaria – recommendations from OECD

The members of the BASPSC welcome the recommendations received from the OECD on the new pension reform.

– The OECD commends Bulgaria’s supplementary pension provision and supports future measures to improve it
– The strengths of supplementary pension insurance were recognised, including the multi-pillar pension model, the stable legal framework and competent risk-based supervision.
– The OECD also noted the scope for improving the pension system by introducing consumer choice between different investment strategies according to their life cycle and risk tolerance (the so-called “multi-fund model”, including funds with different investment profiles) and encouraged the review and changes of the rules governing investment options to achieve increasing returns.

A special article announced details of the letter received by the Ministry of Finance from the OECD recommending to prepare the necessary changes in private pensions. The main objective is to increase retirement incomes and ensure adequate pension payments
In February 2024 in the town of Sofia, the pension and insurance companies actively participated in the fact-finding mission of the Insurance and Private Pensions Committee of the Organisation for Economic Co-operation and Development (OECD), which carried out a review of supplementary pension security and assessed the compliance of Bulgarian legislation and supervisory activity with the OECD recommendations on key principles for the regulation of private pension funds. The OECD mission was accepted by the Ministry of Finance and the Financial Supervision Commission (FSC) with the participation of the Ministry of Labour and Social Policy, representatives of pension companies, business and social partners.

To this end, the competent institutions in the country should clearly and synchronously declare their commitment to the development of legal changes whose philosophy is supported in the context of the recommendations given by the OECD.

The Financial Supervision Commission and the Bulgarian Association of Supplementary Pension Security Companies have launched a dialogue and are ready to propose changes to the regulatory framework in the field of supplementary pension insurance, the ultimate goal of which is to increase the profitability of the management of individual funds of citizens.

Information from the website of the FSC (BG)