Lithuanians advised to make additional contributions, return to Sodra - FinMin

Lithuanian residents who are expected to have the lowest old-age pensions will be advised to make additional contributions to their pension fund or return to the state-run social insurer Sodra, says Finance Minister Vilius Šapoka.

"The second phase of the pension system is far from being perfect, there are places where the efficiency should be improved. Discarding is out of the question. The least efficient place is the 2-percent transfer for those who chose the very minimum. These people risk of not generating the necessary fund for their old age. We have discussed with the prime minister that those who possibly made the choice by mistake at the very beginning – they should be asked about this – may want to make additional contributions or simply return to Sodra. If they are left with the 2 percent, their pension will decrease automatically and they will not accumulate substantial sums," Šapoka said at a news conference on Thursday.

In his words, preparatory work should be started this year, with the changes launched in 2018.

The possibility for second phase participants to return to the Sodra was mentioned by the finance minister and Prime Minister Saulius Skvernelis last December.

At the end of 2016, Lithuania had 21 second phase pension funds, accumulating pensions for 1.255 million participants, indicating an increase by 41,000 or 3.38 percent year-on-year.

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