ITALY – Welfare minister Roberto Maroni was due to meet today with Italy’s main trade unions and employers association Confindustria to discuss the Tfr, one of the pivotal innovations brought by the pension reform.
The meeting will see Maroni confronting national trade unions Cgil, Cisl, Uil and Ugl as well as some employers’ associations including Confindustria.
It comes as the government sets to implement the reform, approved last July, which settles that workers should pay their severance pay, known as Tfr, to pension funds, unless workers explicitly refuse.
The minister and the associations were set to discuss a joint proposal put to the government by the social partners on the organisation of Tfr payment.
Up to now workers have cashed their Tfr at the end of their career, keeping it in their firms. Employers now claim that when the pension reform kicks in, transferring Tfr money to pension funds will imply losing resources.
Wednesday’s talks will pivot on finding resources to compensate employers, highlighting the distinction between collective and individual pension provisions and discussing possible ways to invest Tfr money when workers give no specific instruction.
In addition Maroni should comment on a postscript to the document, signed by the trade unions, which asks the government to provide pension funds for public employees as well.
Meanwhile, in a statement published on its website, the ministry said that the investment of Tfr money in pension funds should start in January 2006. Payments could start in July 2005 “in an experimental fashion.”
According to the statement, the decree on the use of the Tfr should be examined by the cabinet in April, parliament will be canvassed in May. Maroni and prime minister Silvio Berlusconi should give their seal of approval in June.
The statement also includes a cost estimate: €20m in 2005, 200 in 2006 and 500 in 2007. The ministry’s press office, however, was not able to explain whether these estimates referred to Tfr inflows to pension funds, compensations to employers or both.