PUBLIC SECTOR PENSION SCHEME OF ELKARKIDETZA Country: Basque Country, Spain. Database Update: May Name of Scheme: Elkarkidetza (Solidarity).

Transcription

1 Database Update: May 2009 Name of Scheme: Elkarkidetza (Solidarity). Managing Institution: Elkarkidetza (Solidarity). Address: Ramón y Cajal, VITORIA-GASTEIZ Araba/Alava Contact person: Aitor Emaldi Phone: , Fax: aemaldi@elkarkidetza.net Web site:

2 1. DESCRIPTION OF THE SCHEME Scheme features Basic or supplementary? (Please, choose one) Basic. Supplementary. Combination of both systems Compulsory or voluntary? (Please, choose one) Compulsory. Voluntary. Combination of both (i.e. compulsory membership with possibility of a supplementary voluntary insurance; see ) Governed by: (Please choose as adequate) Law. Collective agreement. Both. Others (please specify): Please, indicate legal basis or collective agreement: System classification: a. Please choose one: Defined Benefit (DB). Defined Contribution (DC). Mixed b. Please choose one: Pay As You Go (PAYG). Funded. Hybrid

3 1.1.4.c. Method of acquiring rights (Please choose one): Points Annuities Other (please specify): In this sense, Elkarkidetza works as an Investment Fund: the member's contributions buys participations that vary their valuation as time goes by as a function of the assets results Taxation principles (regarding Contributions/Returns/Benefits): EET (Exempt/Exempt/Taxed). ETT (Exempt/Taxed/Taxed). TEE (Taxed/Exempt/Exempt). Others (please specify): Fiscal advantages (for employers, employees and for the pension institution), if any apart from the ones mentioned in : for the employers there are no fiscal advantages if they are public institutions; if they are public corporations, they can deduct the contributions from the corporation tax base;for the employees, contributions (employer's and employee's) are deducted from the base of the income tax; for the pensin institution there are no fiscal advantages as the corporation tax has a 0% rate Legal position regarding EU legislation. Please indicate, answering yes/no, under which EU-legislation your scheme falls. The following classification maintains the current subdivision into three pillars: a. Regulation 1408/71(in the future: Regulation 883/2004) - statutory application of this Regulation or by notification of the Member State: NO b. Directives for supplementary pensions, such as Directive 98/49 EC, Directive 2003/41 ( Pension Fund Directive ), Proposal of a Directive to improve portability of supplementary pension rights COM(2005) 507 ( Portability Directive ): YES c. Life insurance Directives (in the future the Solvency II Directive ): NO

4 1.2. Population involved Employers a. Who they are (e.g. ministries, public bodies, local governments, church staff, special entities employing teachers, police, fire-fighters, other particular entities for particular public services like energy, water, public transport, hospitals or childcare): county administration, local administration and public corporations b. Number of employers: 477, as of 31 Deceember Employees a. Staff working for the above mentioned employers indicate if there are particular conditions like specific status, minimum working time, specific labour contracts minimum age for membership? No limitation at all, though due to labour laws, no one under 18 is liable to work for the public administration b. Number of active employees: 20, c. Number of retired employees: 3, d. Number of former employees with deferred rights: 1, Governance Decision-making body (Boards, trustees, etc, giving a brief description: number of components and their role, appointed and/or elected, renewal procedure ): General Assembly (Asamble General), wich normally gathers once a year, with 100 members, 50 representing the employers, and 50 representing the employees; decisions are voted and need mayority of both sides Board (Junta de Gobierno), which normally gathers quarterly and has 16 members, 8 representing the employers, and 8 representing the employees; decisions are voted and need mayority of both sides Supervision (indicate the supervisory entities overseeing the scheme, if any, pointing out the nature of their supervision financial, legal ): Basque Government

5 1.4. Basic financial data Income a. Global amount of contributions: million b. Scheme s financial results, its return on investments in net/gross terms (for the last year, last 5 years, last 10 years, last 15 years, last 20 years, since inception as it results feasible) : % Last 5 years (average) 4.53% Last 10 years (average) 4.68% Last 15 years (average) 7.43% Last 20 years (average) 8.09% Since inception (23 years) 8.61% c. Reserves (for funded schemes). If possible, including legal funding requirements, funding ratio : c.1. Reserves: million. Capital funding: million. Funding ratio: % Expenditures a. Global amount of benefits paid to beneficiaries as defined in 2 to 6 (i. e. old age pension, disability pension, early retirement, survivors pension for spouse or children), in local currency and/or : million during b. Administrative costs (if mentioned in Annual Report can be expressed as an amount, a percentage of the capital, a percentage of the total annual contributions, a percentage of the annual benefits, or any other figure): 0.41% of the assets c. Other expenses (if representative):

6 Asset Allocation (roughly, as a percentage with no decimals): a. Fixed Income: 58.89% b. Equity: 13.48% c. Real Estate: 4.10% d. Cash: 15.80% e. Others (specify if you consider it necessary): 7.73% TOTAL: 100% 1.5. Contribution rates Employers: a. Is the contribution a percentage of a base? Yes b. If so, which base is the contribution calculated upon? Own calculation bases, which intend to represent the average salary of the different clasifffications of the civil service c. If not, how is the contribution calculated? d. Is there a ceiling for the amount of the contribution? Yes e. If so, how is it calculated? 3.5% of the calculation bases, made through 12 payments, once per month (June and December have double payments, as in the case of the salaries) f. Is the contribution compulsory? Yes, as long as the employee makes a symmetrical contribution g. If so, is there any additional requirement (e.g. it must be the same amount as the employee s contribution, or there is a vesting period, or )? The amount must be the same as the one paid by the employee Employees: a. Is the contribution a percentage of a base? Yes

7 1.5.2.b. If so, which base is the contribution calculated upon? Own calculation bases, which intend to represent the average salary of the different clasifffications of the civil service c. If not, how is the contribution calculated? d. Is there a ceiling for the amount of the contribution? Yes e. If so, how is it calculated? 3.5% of the calculation bases, made through 12 payments, once per month (June and December have double payments, as in the case of the salaries) f. Is the contribution compulsory? No g. If so, is there any requirement (e.g. it must be the same amount as the employer s contribution, or there is a vesting period, or )? Possibility of paying additional/optional contributions: a. The scheme admits (tick as appropriate): AVC (Additional Voluntary Contributions) Deferred compensation (part of the salary is transferred into the pension scheme in order to buy additional pension rights) Purchase of Additional Points Others (please specify): there is not the possibility b. Are the optional contributions administered separately? c. Indicate if the survivor coverage is subject to voluntary contribution (see 5.1): No, it is compulsory and included in the contribution

8 1.6. Purchase of extra years / validation of past services Extra years: a. Is it possible to buy extra years (e.g. a person works for an institution during the fifteen years prior to retirement, while he is 50 to 65 years old; the institution s pension scheme could require a twenty years contribution in order to get a partial pension, or a full pension, or Is it feasible to buy -pay for them, usually after an actuarial calculation- the needed extra five years? Or even some more if the person wants to increase their pension?)? No b. If so, how is it done? Past services: a. Is it possible to validate past services (e.g. a person works for an institution during fifteen years but has not joined its pension scheme; after this time, she/he decides to join the scheme: Is it possible to make up for the unpaid contributions of those fifteen years?)? NO b. If so, how is it done? Portability Is it possible to execute transfers to the scheme? Yes Are transfers taking place at present (if they are possible and they are not being carried out, please explain why)? Yes If transfers are possible, describe briefly transfer conditions and process (please differentiate among national and cross-border level whenever it is feasible and relevant): Inbound and outbound are possible, they should be from/to a second pillar employment scheme, and the benefits should be paid as annuities, it being a compulsory requirement that needs to be reflected in the internal regulations of the institution. We have not had any cross-border transfer up to this date, though they are possible as long as they fulfill the compulsory requirements demanded for the national transfers

9 2. OLD AGE PENSION. 2.1 Qualifying conditions Retirement age: a. Legal compulsory age: b. Scheme compulsory age: c. Minimum age: 60 as a general rule, 58 for specific schemes (firemen only) d. Maximum age: e. Average age: for the year 2008, years; for the period , years f. Are there different rules regarding certain groups (women/men, employed/unemployed, disabled persons )? If there are, please describe: No Qualifying period: a. Minimum period of membership -and/or at work in case it is relevant- (in years): No b. If it exists, please indicate if it is in the process of decreasing or increasing: Calculation method DB scheme a. Calculation formula: b. Brief description of the elements used in the formula (if they are not used, simply delete as adequate; if it is not considered, simply add it in the Others section): - Pensionable salary: - Accrual rate: - Vesting period, if any: - Minimum working time, if any: - Minimum number of years guaranteed, if any: - Maximum number of years, if any: - 9 -

10 - Minimum age, if any: - Maximum age, if any: - Others: c. Consequences of early/late retirement: DC scheme / or NDC (notional defined contribution) scheme a. Is there a guaranteed return? No b. Please indicate the existence of any of the following (for any points not considered, simply delete as appropriate; if any points are not included, simply add it in the Others section): - Vesting period, if any: No. - Minimum working time, if any: No. - Minimum number of years guaranteed, if any: No. - Maximum number of years, if any: No. - Minimum age, if any: legal age, 18 years of age. - Maximum age, if any: at 65 the worker can retire, it is compulsory to do it at the age of 70, but the member could leave his rights untouched until he/she decides to start receiving the benefit. - Others: c. Consequences of early/late retirement: There are consequences regarding the calculation of the actuarial annuity d. Extra information affecting the calculation (unisex/differentiated tables by gender, different calculation depending on age or seniority ): differentiated tables by gender and marital status Pension amount a. Is there a minimum guaranteed benefit? No b. Is there a limited maximum benefit to be paid? No

11 Benefit payment/s: (please choose as adequate) Monthly payments. Lump Sum. Calculation formula: Bonuses (e.g. an extra payment at Christmas): Comments (possibility of various lump sums ): If the monthly payment does not reach the amount of 100 per month, the benefit is paid as a lump sum Benefit payment mechanism: (please choose as appropriate) Benefits are paid directly from the fund (e.g. as in a PAYG scheme). The individual economic rights add up to a determined amount which is converted into an annuity. Members are allowed to purchase annuities from a supplier. Comment on any other possibility: Nature of annuities: (please choose as adequate) Lifetime. Deferred. Variable. Comment on any other possibility: temporal annuties for survivors pension in the case of childhood benefits Flexible or part time pension Can the pensioner continue at work while receiving a pension? Full time Part time No

12 If so, what are the conditions to be met? a. Minimum age: b. Minimum period of membership/at work: c. Others (fill in as you consider appropriate): Calculation of the pension (is any reduction factor used?): Is there a minimum pension? Is the pension received while working a monthly payment or a lump sum? Is there a pension abatement over a certain salary level? If there is such abatement, how is it calculated? 2.4. Indexation Kind of indexation: (please choose one) Price indexation. Calculation: Wage indexation. Calculation: Other indexation. Calculation: 70% of the excess of the financial result over the minimum 4%. No indexation Conditions applicable to early leavers for the indexation of deferred pension rights (if any): Their deferred pension rights are indexed to the assets financial evolution Distribution of rights in case of divorce: Are the pension rights split between spouses/partners in case of divorce? We are up to the Courts judgements If it is so, please give a brief description of how the division is carried out: They are carried out as every Judge decides in his/her sentences

13 3. DISABILITY PENSION Qualifying conditions: (please choose one) Notion of disability linked to job related incapacity (incapacity to carry out the usual job) Notion of disability linked to work related incapacity (incapacity to carry out any job) Others. Please explain: 3.2. Pension calculation: The calculation is the same calculation as for retirement pension? The members pension rights, plus an insured capital which depends on the members age and his last 12 monthly contributions, are added up and the actuarial annuity is calculated Are there any extra pension rights? yes, it is the insured capital mentioned in the section Does the cause of the disability affect pension calculation (for example, does a work related disability provide better pensions)? No

14 4. SURVIVOR S COVERAGE 4.1. Surviving spouse (or partner) pension Accrual of survivor s pension rights a. The survivor coverage is: (please choose one) Compulsory Optional b. At the time of accruing survivor s pension rights, are there different options/alternatives? No Qualifying conditions (these ones or any other): a. Age: No b. Minimum marriage duration: No c. Any other requirement: No d. (Legal) Recognition of the following partnerships: (choose as adequate, as many as it is necessary) Spouses of different gender admitted (married). Spouses of the same gender admitted (married). Civil partners of different gender admitted (unmarried). Civil partners of the same gender admitted (unmarried). Couples of different gender with no legal liaison admitted. Couples of the same gender with no legal liaison admitted e. Divorced spouses/partners: e.a. Are they entitled to the pension? We are up to the Courts judgements e.b. Is there any (legal) pension sharing mechanism between present and past spouses/partners? We are up to the Courts judgements f. If a widow/divorced/partner remarries, does she/he lose any pension entitlement? No

15 4.1.2.g. Is personal income taken into account at the time of calculating the surviving spouse pension? No Calculation method (considering the different possible alternatives): If the member dies while working,the members' pension rights, plus an insured capital which depends on the members age and his last 12 monthly contributions, are added up and the actuarial annuity is calculated. If the member dies while retired, the survivor's benefit sums up 50% of the members' benefit Distribution of rights in the case of divorce a. Are the pension rights split between spouses/partners in the case of divorce? We are up to the Courts judgements b. If it is so, please give a brief description of how the division is carried out: We are up to the Courts judgements Children pension Qualifying conditions a. Age limits: Maximum age, 25 years; after this age, no benefit is paid b. Time duration: Maximum age, 25 years; after this age, no benefit is paid c. Possible extensions and their causes (e.g. disabilities, studies ): No d. Is personal income taken into account at the time of calculating the child pension? No Calculation method: If the member dies while working and there is not survivor's spouse/partner benefit,the members' pension rights, plus an insured capital which depends on the members age and his last 12 monthly contributions, are added up and the actuarial annuity is calculated. If the member dies while retired, the survivor's children benefit sums up 9% of the members' benefit per child, regardless of the existence of a survivor's spouse/partner benefit being paid; there is the limit of 100% of the member benefit summing up survivor's spouse/partner benefit plus all the children pension

16 5. ADDITIONNAL INFORMATION Comments on recent, ongoing or future reforms: The governing bodies increased their size, from 48 to 100 members the General Assembly, and from 12 to 16 the Board Comments on any of the previous sections (please include the section heading references): 5.3. Comments on any possible interesting information not considered in the questionnaire: 5.4. Comments on any possible restriction on the information to be displayed (e.g. section 1.4. to be accessible to other EAPSPI members only, or to the General Secretariat and Board only, or we will not answer that section as we consider it is for the member s internal use only, or to be used for statistical purposes only ). If nothing is declared, the General Secretariat understands that the authorisation to use and display the information is given, always limited to it being used according to the aim and mission of the EAPSPI, and for no commercial use of any kind: