Latvia’s parliament, the Saeima, decided on March 5th not to back proposals to change the rules on second-pillar pension savings.
Members of the opposition Latvia First Party (LPV) faction proposed amendments to the State Funded Pensions Law, in line with the Estonian example, to allow residents to voluntarily choose to withdraw or partially withdraw their 2nd pension level savings.
Member of Parliament Edmunds Zivtiņš (LPV) stated: “We propose not to destroy the 2nd pension level, but to free it up and create greater trust. If a person wants, they will be able to withdraw their savings, part of their savings, or they will be able to leave them untouched… This is a matter of trust in the state and the pension system as a whole.”
In response, MP Edmunds Jurēvics of the coalition New Unity party compared this proposal to trying to warm up by setting fire to the roof of a house, only to freeze to death next winter. Dismantling the current pension savings system would mean great risks of poverty for future pensioners, he argued.
“In this Saeima, we have done a lot to help existing seniors. But we, the parliament, must think not only about the next elections, but also about future generations of pensioners… We cannot tolerate such short-term populism,” said Jurēvics.
The submitted proposal was supported by 23 deputies, opposed by 41, and abstained by 21, so does not proceed to committee for further discussion. However, it is worth noting that four deputies representing the coalition party the Greens and Farmers Union (ZZS) supported the opposition proposal.
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