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Lithuanian Pension Association Sues Government
By Global Pensions
November 30, 2010
Lithuania
Bank
of
Lithuania
. Photo: Global Pensions.
The
Lithuanian Association of Pension Fund Participants is suing the
country’s government for reducing contributions to its private pension
system.
The association
claims the government failed to fulfill the requirements of pension reform
legislation, which proposes a 5.5% contribution of gross salary. The
initial contribution level was set at 2.5% in 2004 with an annual increase
of 1% each year until it reached 5.5%. In 2007, the rate hit the target
rate but then decreased to 3% in January 2009 and 2% in July, the
association said.
In total, the
government has failed to pay citizens LTL850m ($323m) as of November 2010,
it added.
"We care
about our association and our members and want what is rightfully
ours," a spokesman said. "Our parliament promised to recover the
payment contributions but has failed to do so. There has been no
compensation; they have just dismissed the whole thing."
The suit has
been processed through the nation's lower courts and has been sent to the
constitutional court and is set to be processed next year, the spokesman
added.
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