Consultations on employer-sponsored PPK pension plans soon

Poland is finishing works on the draft bill on the employer-sponsored pension plans PPK and will launch consultations on it soon, the Ministry of Finance said. The new program seeks to have firms and employees put a total of 3.5 percent of gross wages into privately managed Employee Pension Plans (PPK) – 1.5 percent from the employer and 2 percent from the employee. Workers will also have the right to opt out of the program, yet according to government’s estimates, 75 percent will choose to be a part of the plan. It should come into force from 2019 for large companies (over 250 employees), mid-2019 for mid-size (50-249) and mid-2020 for others. Additionally, the state will add PLN 240 per year to each account on top of the PLN 250 start-up bonus, which according to calculations will cost the budget PLN 1.1 billion in 2019, and PLN 2.5-3 billion afterward. In total, some 11.4 million employees would automatically become members of the opt-out system.