Managers of mandatory private pension funds were in for a surprise in February: the number of clients they were allocated as part of the random distribution system (lottery) climbed by 70% against January, i.e. 32,820 new clients, despite a continued rise in unemployment. They are employees aged under 35 who did not choose a pension fund within four months from starting their first job.
The number of clients who chose their own fund was only 2,500, 35% less than in the first month of this year. People who joined a private pensions fund on their own accounted for only 7% of the overall number of new pension fund clients, while the others resulted from the lottery.
"Maybe some hiring was done in the economy, but it is not very likely. We really don't know where all these participants come from," says Mihai Coca-Cozma, general manager of Alico Pensii pension manager (formerly AIG Pensii).
Very few employees know that they must choose a private pension fund within four months from being employed in their first job. 2% of an employee's gross salary goes into this fund, a contribution which is to be boosted to 2.5% this month.
"Finding eligible clients is very hard to do. (...) Since the contribution is so small, people are not very interested in private pension funds. That is why managers don't invest very much in promotion and in informing people," explains Coca-Cozma.
Managers of mandatory private pension funds were in for a surprise in February: the number of clients they were allocated as part of the random distribution system (lottery) climbed by 70% against January, i.e. 32,820 new clients, despite a continued rise in unemployment. They are employees aged under 35 who did not choose a pension fund within four months from starting their first job.
The number of clients who chose their own fund was only 2,500, 35% less than in t
