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Romania
| Total population (m.): | 21.2 |
| GDP per capita (USD): | 12369 |
Old Age, Disability and Survivors
Regulatory Framework
First law: 1912.
Current laws: 2000 (Law No. 19 of 17 March, on the public pension scheme and other social insurance benefits), implemented in 2001; and 2004 (Act No. 411 on Privately Administered Pensions Funds), with 2005 and 2007 amendments.
Type of program: Social insurance and individual account system.
Current laws: 2000 (Law No. 19 of 17 March, on the public pension scheme and other social insurance benefits), implemented in 2001; and 2004 (Act No. 411 on Privately Administered Pensions Funds), with 2005 and 2007 amendments.
Type of program: Social insurance and individual account system.
Coverage
Social insurance: Employed persons with individual labor contracts; civil servants; certain officials within the executive, legislative, and judicial authorities; craft cooperative members; unemployment benefit recipients; self-employed persons; and certain other workers.
Voluntary coverage for any interested persons.
Special systems for certain professions, such as lawyers, military personnel, and the clergy.
Mandatory individual accounts: All employed and self-employed persons younger than age 36 on January 1, 2008.
Voluntary coverage for those aged 36 to 45 on January 1, 2008.
Voluntary coverage for any interested persons.
Special systems for certain professions, such as lawyers, military personnel, and the clergy.
Mandatory individual accounts: All employed and self-employed persons younger than age 36 on January 1, 2008.
Voluntary coverage for those aged 36 to 45 on January 1, 2008.
Source of funds
Insured person
Social insurance: 10.5% of gross earnings if under social insurance only; 8.5% of gross earnings if under the social insurance and mandatory individual account system.
Voluntarily insured persons contribute 31.3% of insured income if under social insurance only; 29.3% of insured income if under the social insurance and mandatory individual account system.
The contribution to social insurance for those under the social insurance and mandatory individual account system is decreasing gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Mandatory individual account: 2% of gross earnings plus up to 2.5% of contributions and 0.05% of net assets under management a month for administrative fees.
The contribution to the individual account is rising gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Self-employed person
Social insurance: 31.3% of insured income if under social insurance only; 29.3% of insured income if under the social insurance and mandatory individual account system.
The contribution to social insurance for those under the social insurance and mandatory individual account system is decreasing gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Mandatory individual account: 2% of insured income plus up to 2.5% of contributions and 0.05% of net assets under management a month for administrative fees.
The contribution to the individual account is rising gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Employer
Social insurance: 20.8% of gross earnings for employees working under normal conditions; 25.8% of gross earnings for arduous conditions; 30.8% of gross earnings for very arduous conditions.
There are no minimum or maximum earnings for contribution calculation purposes.
Mandatory individual account: None.
Government
Social insurance: Any deficit.
Mandatory individual account: None.
Social insurance: 10.5% of gross earnings if under social insurance only; 8.5% of gross earnings if under the social insurance and mandatory individual account system.
Voluntarily insured persons contribute 31.3% of insured income if under social insurance only; 29.3% of insured income if under the social insurance and mandatory individual account system.
The contribution to social insurance for those under the social insurance and mandatory individual account system is decreasing gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Mandatory individual account: 2% of gross earnings plus up to 2.5% of contributions and 0.05% of net assets under management a month for administrative fees.
The contribution to the individual account is rising gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Self-employed person
Social insurance: 31.3% of insured income if under social insurance only; 29.3% of insured income if under the social insurance and mandatory individual account system.
The contribution to social insurance for those under the social insurance and mandatory individual account system is decreasing gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Mandatory individual account: 2% of insured income plus up to 2.5% of contributions and 0.05% of net assets under management a month for administrative fees.
The contribution to the individual account is rising gradually.
There are no minimum or maximum earnings for contribution calculation purposes.
Employer
Social insurance: 20.8% of gross earnings for employees working under normal conditions; 25.8% of gross earnings for arduous conditions; 30.8% of gross earnings for very arduous conditions.
There are no minimum or maximum earnings for contribution calculation purposes.
Mandatory individual account: None.
Government
Social insurance: Any deficit.
Mandatory individual account: None.
Qualifying conditions
Old-age pension (social insurance and individual account): Age 63 and 9 months with at least 12 years and 6 months of contributions (men) or age 58 and 9 months with at least 12 years and 6 months of contributions (women). The full pension is paid with at least 32 years and 6 months of contributions (men) or 27 years and 6 months of contributions (women).
The pensionable age and contribution periods are rising gradually by 2015 to age 65 (men) and 60 (women) with 15 years of contributions for the minimum pension and 35 years (men) or 30 years (women) for the full pension.
Coverage is credited for certain periods, including periods during which social insurance benefits are received and for periods of university study, military service, or imprisonment.
Lower age requirements apply to persons employed in arduous or dangerous work, persons who have a disability or visual impairment, persons who were imprisoned because of their political beliefs, teachers (under certain conditions), and women who have given birth to three or more children (under certain conditions and if eligible for the full pension).
Early pension: Paid from up to 5 years before the normal retirement age if the insured's number of paid contributions exceeds the number of contributions required for the full pension by at least 10 years.
Partial early pension: Paid from up to 5 years before the normal retirement age if the insured's number of paid contributions exceeds the number of contributions required for the full pension.
Disability pension (social insurance): Paid for the loss of at least 50% of working capacity as the result of an accident (including work-related accidents) and diseases (including occupational diseases and tuberculosis). For students and apprentices, only disabilities resulting from work are covered. Prior contribution conditions vary according to the insured's age when the disability began. Contribution conditions are waived if the disability is the result of a work accident, an occupational disease, tuberculosis, or military service.
Disability pension (individual account): Paid if assessed with a permanent disability and incapacity for any work.
Survivor pension (social insurance): The insured was eligible for a pension or was a pensioner at the time of death.
Eligible survivors are a widow(er) who satisfies age and marriage conditions or has a disability (waived if the death is caused by a work accident, an occupational disease, tuberculosis, or if the survivor has a dependent child younger than age 7) and children up to age 16 (age 26 if a student, depending on the duration of studies; no limit if disabled). A limited pension is paid for 6 months to a low-income uninsured spouse who does not satisfy the age and marriage conditions.
Funeral grant (social insurance): Paid for the death of the insured or the insured's dependent. The benefit is paid to an eligible survivor, to the deceased's legal heir, or to the person who paid for the funeral.
Survivor pension (individual account): If the insured dies before receiving a benefit from the individual account, the value of his or her accumulated assets is split and transferred to the individual accounts of eligible survivors.
The pensionable age and contribution periods are rising gradually by 2015 to age 65 (men) and 60 (women) with 15 years of contributions for the minimum pension and 35 years (men) or 30 years (women) for the full pension.
Coverage is credited for certain periods, including periods during which social insurance benefits are received and for periods of university study, military service, or imprisonment.
Lower age requirements apply to persons employed in arduous or dangerous work, persons who have a disability or visual impairment, persons who were imprisoned because of their political beliefs, teachers (under certain conditions), and women who have given birth to three or more children (under certain conditions and if eligible for the full pension).
Early pension: Paid from up to 5 years before the normal retirement age if the insured's number of paid contributions exceeds the number of contributions required for the full pension by at least 10 years.
Partial early pension: Paid from up to 5 years before the normal retirement age if the insured's number of paid contributions exceeds the number of contributions required for the full pension.
Disability pension (social insurance): Paid for the loss of at least 50% of working capacity as the result of an accident (including work-related accidents) and diseases (including occupational diseases and tuberculosis). For students and apprentices, only disabilities resulting from work are covered. Prior contribution conditions vary according to the insured's age when the disability began. Contribution conditions are waived if the disability is the result of a work accident, an occupational disease, tuberculosis, or military service.
Disability pension (individual account): Paid if assessed with a permanent disability and incapacity for any work.
Survivor pension (social insurance): The insured was eligible for a pension or was a pensioner at the time of death.
Eligible survivors are a widow(er) who satisfies age and marriage conditions or has a disability (waived if the death is caused by a work accident, an occupational disease, tuberculosis, or if the survivor has a dependent child younger than age 7) and children up to age 16 (age 26 if a student, depending on the duration of studies; no limit if disabled). A limited pension is paid for 6 months to a low-income uninsured spouse who does not satisfy the age and marriage conditions.
Funeral grant (social insurance): Paid for the death of the insured or the insured's dependent. The benefit is paid to an eligible survivor, to the deceased's legal heir, or to the person who paid for the funeral.
Survivor pension (individual account): If the insured dies before receiving a benefit from the individual account, the value of his or her accumulated assets is split and transferred to the individual accounts of eligible survivors.
Cash benefits for insured workers (except permanent disability)
Old-age pension (social insurance): The pension is based on the insured's average lifetime accumulated number of pension points multiplied by the pension point value at the date of retirement. The number of pension points obtained during 1 year is equal to the insured's monthly average wage divided by the national monthly average wage. At retirement, the average number of pension points is calculated by dividing the insured's total lifetime accumulated number of pension points by the number of years of contributions.
The pension point value is 732.8 new lei (October 2009).
Insured persons can resume gainful activity if the net pension is less than the national monthly average gross wage.
The national monthly average gross wage is 1,693 new lei.
Early pension: The early pension is calculated in the same way as the old-age pension. Credited covered periods are not taken into account for pension calculation purposes.
Partial early pension: A reduced pension is paid. Credited covered periods are not taken into account for pension calculation purposes.
Old-age benefits are payable abroad.
Benefit adjustment: Benefits are adjusted annually in December according to changes in the pension point value, which is linked to the expected inflation rate for the coming year.
Old-age pension (individual account): At the normal pensionable age, the insured receives a monthly pension for life based on the value of the accumulated capital. If the calculated monthly pension is lower than a prescribed monthly minimum, a lump sum may be paid or a limited pension paid for up to 5 years.
The pension point value is 732.8 new lei (October 2009).
Insured persons can resume gainful activity if the net pension is less than the national monthly average gross wage.
The national monthly average gross wage is 1,693 new lei.
Early pension: The early pension is calculated in the same way as the old-age pension. Credited covered periods are not taken into account for pension calculation purposes.
Partial early pension: A reduced pension is paid. Credited covered periods are not taken into account for pension calculation purposes.
Old-age benefits are payable abroad.
Benefit adjustment: Benefits are adjusted annually in December according to changes in the pension point value, which is linked to the expected inflation rate for the coming year.
Old-age pension (individual account): At the normal pensionable age, the insured receives a monthly pension for life based on the value of the accumulated capital. If the calculated monthly pension is lower than a prescribed monthly minimum, a lump sum may be paid or a limited pension paid for up to 5 years.
Permanent disability benefits for insured workers
Disability pension (social insurance): The pension is based on the insured's average lifetime accumulated number of pension points multiplied by the pension point value on the date the disability began. The number of pension points obtained during 1 year is equal to the insured's monthly average wage divided by the national monthly average wage. In addition, for each year that the disability began before the insured has the required number of contributions for the full pension, the insured is credited with 0.75 pension points for a 1st degree disability (incapacity for any work and requiring constant attendance), 0.6 pension points for a 2nd degree disability (incapacity for any work but not requiring constant attendance), or 0.4 pension points for a 3rd degree disability (incapacity for usual work). The average lifetime number of pension points is calculated by dividing the insured's total lifetime number of accumulated pension points by the number of years of contributions. The pension is based on the insured's average lifetime number of pension points multiplied by the pension point value in force on the date the disability began.
The pension point value is 732.8 new lei (October 2009).
Constant-attendance supplement: If the insured is assessed with a 1st degree disability, a lump sum of 587 new lei is paid.
At the pensionable age, the insured can opt for a disability pension or an old-age pension, whichever is greater. If the insured is assessed with a 1st degree disability, the constant-attendance allowance continues to be paid with either option.
Insured persons receiving a 3rd degree disability pension can combine the pension with earnings from gainful employment if the net pension is less than the national monthly average gross wage.
The national monthly average gross wage is 1,693 new lei.
Disability benefits are payable abroad.
Benefit adjustment: Benefits are adjusted annually in December according to changes in the pension point value, which is linked to the expected inflation rate for the coming year.
Disability pension (individual account): The insured receives a monthly pension based on the value of the accumulated capital. If the calculated monthly pension is lower than a prescribed monthly minimum, a lump sum may be paid or a limited pension paid for up to 5 years.
The pension point value is 732.8 new lei (October 2009).
Constant-attendance supplement: If the insured is assessed with a 1st degree disability, a lump sum of 587 new lei is paid.
At the pensionable age, the insured can opt for a disability pension or an old-age pension, whichever is greater. If the insured is assessed with a 1st degree disability, the constant-attendance allowance continues to be paid with either option.
Insured persons receiving a 3rd degree disability pension can combine the pension with earnings from gainful employment if the net pension is less than the national monthly average gross wage.
The national monthly average gross wage is 1,693 new lei.
Disability benefits are payable abroad.
Benefit adjustment: Benefits are adjusted annually in December according to changes in the pension point value, which is linked to the expected inflation rate for the coming year.
Disability pension (individual account): The insured receives a monthly pension based on the value of the accumulated capital. If the calculated monthly pension is lower than a prescribed monthly minimum, a lump sum may be paid or a limited pension paid for up to 5 years.
Survivors benefits for dependents
Survivor pension (social insurance): The pension is based on the old-age pension the deceased received or was entitled to receive. If the deceased was not eligible for the old-age pension or received a disability or early old-age pension, the survivor pension is based on the 1st degree disability pension. The pension amount is calculated as a percentage of the average lifetime number of pension points accrued to the deceased. That percentage varies according to number of eligible survivors: for one survivor, 50%; for two survivors, 75%; or for 3 or more survivors, 100%.
If the survivor is also eligible for an old-age pension in his or her own right, the greater of the two benefits is paid. Full orphans receive two pensions if both parents were insured.
Survivor benefits are payable abroad under bilateral agreement.
Benefit adjustment: Benefits are adjusted annually in December according to changes in the pension point value, which is linked to the expected inflation rate for the coming year.
Survivor pension (individual account): If the insured dies before receiving a benefit from the individual account, the value of his or her accumulated assets is split and transferred to the individual accounts of eligible survivors.
Funeral grant (social insurance): A lump sum of 1,702 new lei is paid for the insured's funeral; the grant is reduced by 50% for the funeral of the insured's dependent.
If the survivor is also eligible for an old-age pension in his or her own right, the greater of the two benefits is paid. Full orphans receive two pensions if both parents were insured.
Survivor benefits are payable abroad under bilateral agreement.
Benefit adjustment: Benefits are adjusted annually in December according to changes in the pension point value, which is linked to the expected inflation rate for the coming year.
Survivor pension (individual account): If the insured dies before receiving a benefit from the individual account, the value of his or her accumulated assets is split and transferred to the individual accounts of eligible survivors.
Funeral grant (social insurance): A lump sum of 1,702 new lei is paid for the insured's funeral; the grant is reduced by 50% for the funeral of the insured's dependent.
Administrative organization
Social insurance
Ministry of Labor, Family, and Social Protection (http://www.mmuncii.ro) is responsible for general supervision and policy development.
Ministry of Labor, Family and Equal Opportunities
2-4 str. Dem. I. Dobrescu,
1-Bucarest,
Romania
Tel.: +(4021) 312 13 17
Fax: +(4021) 312 13 17
National Pension and Social Insurance Fund (http://www.cnpas.org), with regional pension funds, administers the program.
National Pension and Social Insurance Fund
8 str. Latina,
2-Bucarest,
Romania
Tel.: +(4021) 316 91 11
Fax: +(4021) 316 91 12
Individual account
Private Pension Supervision Commission (CSSPP) (http://www.csspp.ro) regulates and supervises pension funds.
Private Pension Supervision Commission
Splaiul Unirii 74,
Bucharest 030128
Romania
Tel.: +(4021) 330 1035
Fax: +(4021) 330 1031
Private pension fund administrators (PPFAs) administer individual capitalization accounts and pay pensions.
Ministry of Labor, Family, and Social Protection (http://www.mmuncii.ro) is responsible for general supervision and policy development.
Ministry of Labor, Family and Equal Opportunities
2-4 str. Dem. I. Dobrescu,
1-Bucarest,
Romania
Tel.: +(4021) 312 13 17
Fax: +(4021) 312 13 17
National Pension and Social Insurance Fund (http://www.cnpas.org), with regional pension funds, administers the program.
National Pension and Social Insurance Fund
8 str. Latina,
2-Bucarest,
Romania
Tel.: +(4021) 316 91 11
Fax: +(4021) 316 91 12
Individual account
Private Pension Supervision Commission (CSSPP) (http://www.csspp.ro) regulates and supervises pension funds.
Private Pension Supervision Commission
Splaiul Unirii 74,
Bucharest 030128
Romania
Tel.: +(4021) 330 1035
Fax: +(4021) 330 1031
Private pension fund administrators (PPFAs) administer individual capitalization accounts and pay pensions.
Last survey reply: 01 January 2010
Last ISSA update: 01 January 2010
Exchange rate: US$1.00 equals 2.94 new lei.