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The bill, issued late on 10 October, puts in place essentially all the proposals announced in September, alongside punitive restrictions on advertising by the second-pillar funds (OFEs) and some proposed changes to the third pillar. Its publication marks a U-turn from 1999, when the establishment of the mandatory second pillar was seen as a means of providing higher retirement income while eventually reducing the pension and public deficit, to a position where the system has ostensibly done the opposite.
The Finance Ministry has estimated that the changes will in 2014 reduce the public debt by 8.4 per cent of GDP according to national accounting standards and by 9.2 per cent according to EU methodology.
In future, the OFEs will be banned from investing in any state securities, not just Polish ones, as well as state-guaranteed loans, deposits and related instruments. As part of what the government has consistently called "real economy" investment, they will be allowed to invest in Polish road and other infrastructure bonds, corporate and municipal issues.
The draft also covers changes in the third-pillar IKZE retirement accounts introduced in 2011 to improve the take-up, including increasing the limit on tax-free contributions and reducing the tax on payouts to 10 per cent.
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