June 7th, 2011

Parliament passes amendment effectively ending early retirement pensions for men

Parliament passed a Fidesz constitutional amendment motion that will effectively end early retirement for men in Hungary, on Monday afternoon.

The amendment is primarily intended to send back to work retired law enforcement officers under 57 as well as those under 62 who are claiming invalidity benefits, but will not cut the preferential pensions of women, miners, chemists and artists.

Preferential pensions will be reduced and re-categorised as welfare benefits.

The House voted on the proposal jointly submitted by János Lázár, István Balsai and Márta Talabér in a roll call vote, at the request of the Socialist Party.

Independent MP Lajos Posze was the only non-governing MP to support the motion.

Before the vote Socialist politician Tamás Harangozó had noted that if Parliament revokes early retirement, then talks between the law enforcement unions and the cabinet will be rendered pointless.

The Socialist Party declared its solidarity with the law enforcement unions and invited them to consultations to jointly formulate the basic principles that the Socialists could represent if they regain power.

Jobbik said before the vote that it would appeal to the Constitutional Court on account of discrimination if law enforcement employees are deprived of their pensions.

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  • Richard

    This move by Fidez has been done so quickly as to negate any attempts by those who were effected. Additionally, as this reads it only specifically mentions the police but it also includes firemen and retired military. These workers are all in special high risk categories who were forced to retire early by this same Fidez government during the previous time they were in office. Now they don’t actually want to pay for the drastic reductions they mandated before? This is entirely unfair especially now that these personnel have been away from these duties for so long as to be useless. Do you really want a 55 year old helicopter pilot (oh yeah the Hungarian military is down to less than 10 helicopters now, so what are these guys supposed to do?) flying again, or an old firefighter? Plus given that the life expectancy of Hungarian men, particularly those in high risk occupations, is 56 years old so effectively the Fidez government is betting on these guys dying before they collect any benefits.

  • FIDESZ style

    If FIDESZ is so eager to save money on pensions, why don’t they just do the humane thing and shoot the elderly.
    Low pensions and substandard health care only make them suffer a slow, painful and humiliating death.

  • wolfi

    @Fidesz:

    No problem – they’re allowed to distill 50 liters of their own palinka, so they’ll drink themselves to death quickly

  • Anon600AD

    I think it’s just a reality that retirement ages are going up, and that pensions are decreasing. By the time I’m retirement age, there won’t even BE a pension in Australia. The thing is, no matter which way you look at it, you might solve one problem, but will inevitably create (or exacerbate) another. With more older people staying in the work force, it is harder for young people to find work, which in Hungary’s case, generally drives them abroad. In the case of the police force too, I actually think that apart from it being a high risk occupation, it’s a good thing to ‘force’ the older ones to retire, because this is the only way you’re ever going to get rid of the dead-wood at the top.

    • Szabad Ember

      You’re right that young people need to get a crack at jobs, too, but early retirement causes more problems than it solves. The secret is to create more jobs, which will probably happen once the economy gets going again.

      Instead of forcing the dead-wood to retire, maybe they should be pushed into desk jobs or given training positions, since they could still do some kind of work. If not, taxing their pensions keeps them from taking advantage of the system when they take their state-financed training and connections to a private security firm.

      If I were one of these people, I would be ticked off, as well, since they were promised something that is now being taken away. Still, lots of people are suffering much worse then they are; at least they still have decent jobs.

      • Anon600AD

        Szabad Ember:
        The Rendorseg is something of an exception to the rule in my opinion. The dead-wood I refer to includes middle to upper management, much of which is still occupied by former communist party members or their proteges. This is one of the key reasons the police force is still so corrupt, poorly resourced and under-trained. Other than the ability to sleep upright or the skills of ‘advanced embezzlement’, I’m not sure they possess a whole lot that is really worth hanging onto. Some of these guys should have been taken off their Vadasz IV years ago and keeping them there just occupies space (physical, organisational AND financial) that could be used to employ younger, more intelligent, hopefully less corrupt officers for whom the real world ‘out there’ is more than just a theoretical concept or distant memory.

        Other than the Rendorseg, I don’t disagree with you. I do agree that early retirement is a waste of skills and experience in many areas, not least, the ‘traditional’ trades.

        • Szabad Ember

          You’re right, don’t bring the older, Kádár-trained police back, just tax their pensions; if they truly live on just their pensions, they shouldn’t have to pay tax. If they have another job, don’t let them get our tax dollars as a free supplement. Of course, that acts as a small discouragement to able-bodied people getting work, but, right now, unemployment is high enough that such things don’t matter.

  • Richard

    I couldn’t agree more. In the US they want to raise the retirement level to 70 years old. It would be smarter to lower it as they did in Russia as the pension funds are fully funded but unemployment compensation is not. If they use the existing funding already fenced for the pension system and force retirements down to age 55 or so (currently in the US it is a minimum of 62) then that opens up a lot of jobs while lowering the amount of money being paid already in unemployment compensation. In Hungary they are forcing these Pensioners back into an already stressed work force with very high unemployment with no prospect of any new jobs being added. Clearly, no one in the Fidez government understands simple economics, but it isn’t any different in the US and apparently Australia. What seems ludicrous to me is that all of these governments seem to want to adopt the US model which clearly has failed.

    • Szabad Ember

      I agree that this is probably the wrong time to do this, but eventually there has to be a higher workforce participation rate, or Hungary will not have high enough growth. For every person collecting a pension, which is partially funded by current taxes, there needs to be a large number of people working and paying taxes, otherwise either taxes go up or other government spending goes down, since a person’s contributions don’t usually cover the cost of his/her pension. If someone is healthy enough to work, he/she should be working. Eventually, the economy will recover enough to absorb all the workers. That’s when these rules should be instituted.

      What bothers me is that women, who generally live longer, get to keep their early retirement. Why do they get special treatment? That is not only sexist, it’s short-sighted, since women are more likely to be gainfully employed in this country.

  • Richard

    You make a good point as the work force is amazingly low with a very high amount of people receiving disability. The early retirements were forced onto these guys during the downsizing and reductions and most were left over from the Soviet days and made very little money under very bad conditions so perhaps all of this is a result of previous conditions. But, to cut off what was guaranteed under the law and then change the constitution to force them back is not right either. Plus, there is no assurance that the economy will recover in any foreseeable future. The world is still hanging on the brink of a catastrophic default of all currencies. The EU cannot continue to bail out the member nations and it is very close to collapsing. The US economy hasn’t improved at all and the policies and regulations that permitted the first crisis haven’t been changed and those same bankers that caused the first crisis are back to their old ways again and it is highly likely to happen again. If the US fails then the rest of the world will follow. Sadly those countries returning to capitalism got hammered just when they were beginning to see day light but now they are struggling just to maintain the status quo. New jobs are going to be the first and highest priority but I don’t see any progress there only promises.

  • Farkas László

    Hi Richard,

    Interesting in the US, it would not be legal to pass such a gender discriminatory law as pertains to retirement age, as it would be struck down in the courts.

    This type of discrimination does go on in other euro couuntries as well. Modern “PC” is still struggling with the notion of men, and what respect and protections (if any ) they merit.

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