Josep Maria Bové urges the Spanish Government to adopt a plan to capitalize the pension system similar to that of the Alpine country
Josep Maria Bové, full academician of the Royal European Academy of Doctors-Barcelona 1914 (RAED), honorary consul of Austria for Catalonia and Aragon and president of Bové Montero y Asociados, one of the leading Spanish firms in the field of auditing and consulting, urges the Spanish Government to implement a capitalization plan of the public pension system similar to the popularly known as the Austrian backpack for its effective implantation in this Central European country. The academician defends this thesis in an article published by the economic supplement “Dinero” of the Spanish newspaper “La Vanguardia” in its edition of February 24.
“Although the Spanish government admits that is studying the possible implementation of an individually oriented capitalization fund towards retirement, the ‘Austrian backpack’, governmental sources have already indicated that it is not a priority and that a long-term debate is necessary. With humility, I disagree: yes, any initiative that contributes to the sustainability of the public pensions system is a priority”, Bové begins his reflection. Data in hand, the academician considers that the State is fleeing from a structural problem that no government has wanted or has managed to confront. “This is the Social Security deficit, which will reach 18,650 million euros in 2019”, he specifies.
For Bové, the Austrian system wouldn not only allow Spain to reduce this galloping deficit, but would guarantee the viability of the current public pension system and it would minimize the tensions that occur in the current Spanish system in unfauvorable economic or labour situations. “The data show that the Austrian model has incentive effects in terms of hiring: in June 2008 the unemployment rate in Spain was 10.4%, against 3.7% in Austria, in March 2013, the figure was increased in Spain to 26.9%, while in the Central European country it was 5.7%, and in December 2018, Spain, 14.3%, and Austria, 4.7%. In adverse economic circumstances, the system is greatly stressed by the loss of contributors (who also go on to collect unemployment), an inconvenience that is minimized in the Alpine country”, explains the academician.
Bové concludes that after the failure of the Spanish Reserve Fund, the popularly known “Moneybox of Pensions”, a change of model is required. “What I said: in front of patches and improvisations, priorities”.