Italian unions meet government for pensions debate

ITALY– The Italian government is to hold talks with the country’s main unions this week about reforming the private pensions industry as part of its strategy to relieve the burden on the state pay-as-you-go system.

The state system accounts for some 15% of Italy’s gross domestic product but demographic changes mean across the board reform is necessary, says a spokesman for IAMA Consulting in Milan.

“Successive governments in the past few years have introduced various reforms for the second pillar of retirement provision which has led to the creation of new company and industry-wide schemes.

“Now it’s time to look at private pensions, since they, in conjunction with the occupational schemes, will help avert a crisis in the state system brought on by an aging population,” he says.

The spokesman says offering tax breaks will be the key to reforming the third pillar sector successfully but, as yet, no details are available.

“There is talk among both government ministers and union officials about the type of tax incentives needed to ensure people consider taking out private pension provision but it’s too early to speculate what form these might take,” he says.

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