Public activists and the opposition call for allowing Latvians to choose their savings in the second pension level.
Latvian Radio reports that 12,000 signatures have already been collected for the initiative to grant Latvians the right to choose their savings in the second pension level. This means that the initiative will soon be submitted to the Saeima. At the same time, a similar bill was introduced by the opposition faction of the Saeima "Latvia First."
However, Ministry of Finance representative Aleksejs Jarockis negatively assessed this idea in an interview with Latvian Radio.
He explained that the second pension level is an important component of Latvia's pension system and was formed as a mechanism for long-term savings. Creating the opportunity to withdraw accumulated savings prematurely does not align with the long-term goals of the pension system.
"This is evidenced by the experience of Estonia. Experience shows that the decision to allow early withdrawals from the second pension level savings by our neighbors is viewed very critically, as it may lead to a significant reduction in pension income for part of the population in the future, as well as increase social security risks," noted Jarockis.
The leadership of the Bank of Latvia also rejects this idea, stating that if it were allowed, inflation would increase. The benefits would be short-term rather than long-term.
