Public Lecture by Vanya Grigorova: Where Our Money Goes – the Private Pension Funds Management
The Public Administration Department organized public lecture Where Our Money Goes - the Private Pension Funds Management with lecturer Vanya Grigorova, Municipal Counsellor in Sofia Municipal Council.
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| Prof. Dr. Tsvetana Stoyanova, Vice-Rector for Institutional and Business Cooperation and Student Policies, Vanya Grigorova, Chief Assist. Dr. Vladimir Valkov from the Public Administration Department /from the right to the left/ |
Prof. Dr. Tsvetana Stoyanova, Vice-Rector for Institutional and Business Cooperation and Student Policies, opened the public lecture pointing out that the topic is extremely actual having in mind that 4 million people are insured under the second pillar, and each month their contributions amount to nearly 190 million BGN. "The level of the supplementary pension that workers born after 1959 will receive depends on the good management of these funds", addressed to the audience Prof. Stoyanova. She greeted the Managing Body of the Department and Chief Assist. Dr. Valkov for the choice of topic and lecturer and expressed confidence that the students will come out of the meeting more familiar with the conditions of mandatory pension insurance.
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"I am sure Mrs. Grigorova will introduce you to the regulatory framework of the activities of private pension funds and the control exercised over them by the Financial Supervision Commission. Each of you, if you have not started your first job, will start it soon and should know that you have the right to choose a supplementary pension fund within 3 months of starting work. If you don`t do it the National Revenue Agency /NRA/ will automatically allocate you to one of the 10 funds. Therefore, it is good to be informed about the returns and fees that the different pension funds have and to make the best decision for your future", advised the students Prof. Stoyanova.
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Chief Assist. Dr. Vladimir Valkov from the Public Administration Department presented Vanya Grigorova as a graduate of UNWE having Master's degree in Marketing, Doctoral student at the moment, Economic Advisor to the President of the Confederation of Labour Podkrepa /till the end of 2023/, currently Municipal Counsellor in Sofia Municipal Council. "We invited Mrs. Grigorova because she has many public appearances on social issues and you study disciplines related to these issues. She will explain to you where your money deducted for pension insurance goes, whether you will have decent pensions and on what it depends on", said Chief Assist. Dr. Vladimir Valkov.
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Vanya Grigorova clarified the emergence of the new pension system, highlighted the specifics of the three-pillar model and emphasized on the second pillar - the so-called universal pension funds, which are additional but also mandatory. She spoke about the development of the pension model over the years and about the repeated amendments to the Social Insurance Code as well about the fees /including the excess fees/, profitability /which is sometimes negative/ and compensations of senior managers of pension companies /not in line with profitability/.
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The Ceremonial Hall was full of lecturers and students not only from the Public Administration Department but also from other Departments at Regional Development Faculty who actively participated in the discussion after the public lecture.
Pension Insurance in Bulgaria
Since 1 January 2000 a new pension insurance system has been in force in Bulgaria, consisting of 3 main pillars:
- State social insurance;
- Supplementary mandatory old-age and death pension insurance (occupational and universal funds);
- Supplementary voluntary pension insurance for unemployment and/or occupational qualification.
The Supplementary Compulsory Pension Insurance /SCPI/ is the second pillar of the pension system in Bulgaria.
Insurance contributions are paid into the individual accounts of the insured persons in the fund, these are the personal accumulated funds of the insured person after deduction of fees and as a result of the achieved / or not achieved profitability of the fund throughout the years.
The participation in a supplementary pension fund is compulsory. The obligation to participate arises at the start of insurance and depending on the type of category of work performed. You can choose your own funds. If you don't do so, you will be randomly allocated.
You must make your personal choice of fund within three months of becoming liable by applying to the pension insurance company managing your desired fund. Information on registered pension insurance companies is available on the website of the Financial Supervision Commission, which regulates the companies. If you don't make a personal choice, you will be allocated to one of the registered pension funds automatically.
You can transfer your individual account from one fund to another fund as well as to the state social security pension fund, subject to certain conditions.
Universities and professional pension funds are established and managed by licensed pension insurance companies, which are nine.
