SLOVAKIA - A pensions reform bill drafted by Slovakia's re-elected prime minister Robert Fico that will roll back some of the changes put in place by his predecessor has now passed parliament.
According to the bill, from September, less money will go into the country's second pillar, and people will be given a five months opt-out window.
The legislation also confirms that contributions to the second pillar will be cut from 9% to 4%.
Slovaks will be given between September and the end January 2013 to decide whether they want to exit the second pillar altogether.
Fico, in a statement issued after the parliamentary vote, claimed the second pillar had returned about 18% less than the first pillar and that the results had been "disastrous".
He said it was the duty of governments to protect savers.
Stanislav Žofčák, head of the Slovak pension fund association ADSS, told IPE that the new law will also introduce a new fee structure for pension funds.
"The basic fee for keeping and managing a retirement account will drop from 1% to 0.75%," he said.
The management fee remains at 0.3% per annum for guaranteed funds and increases in unguaranteed to 0.6%.
Additionally, the 'success' fee will be raised from 5.6% to 10%.
The main opposition parties, including the former government, are planning to challenge the new rules.