Grbin: It is unconstitutional to play with assets worth 20 billion euros

SDP will file a request for a review of the constitutionality of the law that obliges pension funds to invest five percent of net assets in an alternative investment fund because it is ‘unconstitutional to play with citizens’ assets worth 20 billion euros,’ said SDP president Peđa Grbin on Wednesday.

– The law brings huge changes to the way mandatory pension funds will be managed and led. It is grossly unconstitutional to play this way with 20 billion euros of Croatian citizens’ assets. Prime Minister Plenković has sworn throughout his mandate to the stability of the government. This is an indicator of how willing he is to toy with what we all want to be our future, which is security in old age – said Grbin at a press conference at the party headquarters.

The law stipulating the obligation to invest five percent of the net assets of mandatory pension funds of categories A and B in an alternative investment fund with a guaranteed return, which would primarily invest in the domestic economy, was passed by the Croatian Parliament on December 15. It is set to come into force on January 1, but Grbin warns that the law has not yet been published in the Official Gazette, although there are only four days left until the mentioned date.

The assets of mandatory pension funds are worth 20 billion euros, and from the New Year, one billion (five percent) will be invested in alternative investment funds with a state guarantee.

Alternative funds designed for some new Škugor and Barbarić

– Alternative investment funds are obviously designed with the idea that some HDZ members, perhaps some new Škugor, Barbarić, and grandfather Dane, will manage them and use the money of Croatian citizens, future retirees, for who knows what. On the other hand, due to this guarantee that must be provided from the budget, the money of all citizens of this state is at risk – said Grbin.

The SDP president emphasizes that the assets in the accounts of mandatory pension funds are not state assets, but the property of workers who contribute their money every month.

– On one hand, it is about protecting property rights, which is a constitutional category. On the other hand, it is about protecting entrepreneurship. Namely, pension funds, according to the law, are free to decide where to invest the money of Croatian citizens, so the question arises as to why they are being imposed the obligation to invest in alternative investment funds – asked Grbin.

The submission of the request for a review of constitutionality is supported by one-fifth of parliamentary representatives, said Grbin, and he will ask the Constitutional Court to suspend that part of the law relating to alternative investment funds until the judges make a ruling.

– If the Constitutional Court does not do this, this is one of the first things we will change after the elections. This emerging robbery must be prevented, and we in the SDP know how to do it – he said.

Regarding the second pension pillar, Grbin says that the assets in it belong to the citizens and therefore cannot be taken away with a stroke of a pen as many advocate. Instead, an analysis of demographic and economic trends and the depoliticization of the second pillar is needed.

– The second pension pillar cannot be, on one hand, a piggy bank for the state, and on the other hand, a means through which the government will exert its individual influences on certain companies. I remind you of the incident we had with Germany when the HDZ tried to exert pressure for a pension insurance company to do their dirty work – said the SDP president.