ECONOMIC AND DEMOGRAPHIC IMPACTS ON THE PENSION INSURANCE SYSTEM IN THE REPUBLIC OF CROATIA - PROJECTIONS OF THE SUSTAINABILITY OF THE SYSTEM
Abstract: The pension system in the Republic of Croatia, whose stability directly depends on economic and demographic trends, faces long-standing challenges. The first forms of pension insurance in Croatia were based on informal forms of the so-called old-age insurance, while formal forms developed in the 19th century. After the crisis of the socialist period and the acquisition of independence, Croatia implemented a comprehensive pension reform in two phases. In the first phase, which began in 1999, the aim was to rationalize the existing intergenerational solidarity pension system and make it sustainable. After the first, in 2002, a second pension insurance reform was implemented, which constructed the second and third pension pillars and established capitalized pension savings. Despite the reforms implemented, the system still faces significant difficulties in its efficient functioning. This paper focuses on the development and analysis of scenarios for the development of the Croatian pension insurance system from 2021 to 2051, using available projections of demographic, administrative and economic indicators. The aim is to identify key variables important for the sustainability of the system, to identify advantages and disadvantages in its development and to propose specific measures and activities for further development of the system. The above recommendations aim to improve the economic and social effects of pension insurance and ensure its longterm sustainability. Various scientific methods were applied in the research, including analysis, comparison, induction, deduction, description and classification, as well as statistical and mathematical methods for detailed analysis of variables.
Keywords: pension system, demographic and economic indicators, sustainability of the pension system, future development scenario, Republic of Croatia