Employment, Social Affairs & Inclusion

News 01/04/2020

Recent social policy developments in Estonia, Luxembourg and Romania

Four new Flash Reports prepared by the European Social Policy Network (ESPN) are now available and provide information on the Estonian pension reform bill and unemployment protection system, housing policy in Luxembourg as well as the debate in Romania on “special pensions”.

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  • In January 2020, the Estonian pension reform bill was voted through by Parliament. It will make membership of the statutory funded pension scheme voluntary, i.e. insured persons will be able to opt out and withdraw their money or suspend drawing their pension. Although policymakers, social partners and experts agree that the scheme’s performance should be improved, they have diverging views on how to achieve this. The President sent the pension reform bill to the Supreme Court, arguing that there are unconstitutional aspects.
  • In Estonia, low replacement rates and coverage have led people to question the adequacy of the unemployment protection system. In January 2020, the Ministry of Social Affairs notified its intention to draft a law aimed at improving the current system. The amendments would seek to increase coverage, improve willingness to work and reduce poverty.
  • Housing is one of the most important social policy issues in Luxembourg. Recent studies show that building land is concentrated in the hands of very few persons and companies, resulting in excessive price rises and thus many people struggling to pay for their accommodation. To narrow the gap between housing supply and demand, the current government programme includes a number of initiatives in the housing sector such as building more affordable dwellings and overhauling existing laws.
  • The debate on the Romanian so-called “special pensions” has reached a new milestone, as the Chamber of Deputies has recently approved a draft law that abolishes all schemes, with the exception of those for military and police personnel. The law, which has strong public support, has sparked fierce opposition among the affected groups and has been criticised for preserving part of the schemes. Moreover, the effectiveness of the entire legislative process has been questioned, as it is expected that the Constitutional Court will reject the proposal

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