Czechs are living longer, but many do not live well in retirement – in terms of both their physical and financial well-being. With the population rapidly aging, the nation’s already low level of “life expectancy in health” is set to further decline. The Czech government has asked the OECD to help determine how best to make the pension system sustainable. Experts say changing seniors’ dietary and lifestyle habits is a key part of the solution.
The Labour and Social Affairs Ministry will ask the Organization for
Economic Cooperation and Development (OECD) for an analysis of the Czech
Republic’s pension system and a set of ensuing recommendations on reform
which would make it sustainable long-term.
The study should be the basis of a government reform which could be concluded in 2021, the ministry said. Reforming the country’s pension system was one of the government’s stated policy priorities, but no plan for reform has so far been unveiled.
The time spent by Czechs in retirement on average has increased by nearly
four years and four months since 2000, and now stands at about 24 years and
three months, according to an annual study by the Czech Social Security
The main reason is that Czechs are living longer. At the time of the Velvet Revolution, the life expectancy for a Czech man was 68, eight years lower than today at 76. In the last year of Communism, a Czech woman could expect to live to 75.5, compared to 82 now.
At the turn of the millennium, the average retirement pension was paid for nearly 20 years – 16 years and 10 months for men and 22 years and nine months for women. In 1990, the average pension was paid for 16 years, up from 11 years in 1970.
Approximately 190,000 Czech pensioners are living under the poverty line,
with pensions under 10,000 crowns a month, according to data released by
the Czech Social Administration Office.
60,000 thousand pensioners are having to make do with pensions under 8,000 crowns a month.
The poverty line last year was 11,963 crowns per month for individuals living alone. This year it is expected to be higher.
The average old age pension last year was 13,377 crown a month, with men receiving an average pension of 14,697crowns a month and women receiving an average pension of 12,182 crowns a month.
The parties of the ruling minority coalition, ANO and the Social Democrats,
on Monday agreed to raise old age pensions by 900 crowns a month as of
This is perceived as a victory of the Social Democrats who vehemently opposed the 750 crown hike proposed by Finance Minister Alena Schillerová from ANO. Nevertheless the finance minister has stressed that the extra money spent on pensions will have to be saved elsewhere.
The two parties also agreed to raise the children’s allowance from 220,000 to 300,000 crowns. Altogether the hikes should increase state expenditures by 11 billion crowns next year.
Czech travel agencies have noted a steady rise in clients over the age of sixty, reflecting increased spending power among seniors looking to enjoy – in many cases –a long overdue foreign holiday. With the population rapidly ageing, this demographic will be an ever-greater part of agencies’ clientele. And a demanding one, at that.
Coalition parties ANO and the Social Democrats have agreed to set up a new
commission on pensions. It will explore changes to the pension system and
should contain party representatives, experts, academics and people from
seniors’ organisations and NGOs.
ANO and the Social Democrats have also agreed to increase the state children’s allowance. From 2020 families will get a total of CZK 300,000, up from the present amount of CZK 220,000.
The number of people who receive Czech pensions and live abroad has been
steadily growing in recent years, according to data released by the Czech
Social Security Administration on Tuesday. In 2017, the number of Czech
pensioners living abroad reached 93,236 compared to 59,548 in 2010.
More than two thirds of the recipients are based in neighbouring countries: 32,000 pensions are sent to Slovakia, over 19,000 to Germany and over 15,000 to Poland. In total, the Czech Social Security Administration is sending pensions to people in 88 foreign countries.
In several countries there was only one recipient in 2017, including Algeria, India and Madagascar.