A discriminatory law from 2010 is haunting the Orbán government today

It was on August 2, 2010 that Népszava got wind of the government’s plan to allow women who had worked for forty years to retire with full benefits, regardless of age. That would mean that a woman who quit school after eight grades and who began working immediately afterward would be only 55-56 years old when she became eligible to retire. The president of the supervisory body of the pension system expressed her misgivings. She warned that such a decision would transform the whole structure of the system and would also go against the recommendations of the European Union.

At that time the government figured that relatively few women would be eligible, perhaps 6,000, so surely their decision would not upset the stability of the system. Iván László, a gerontologist and Fidesz MP active on the Parliamentary Committee on Youth, Social and Family Affairs, added that the government was planning to change the status of men as well. It was only a question of time (Népszava, August 3, 2010).

It took a little time for MSZP to respond to this announcement. The party called attention to the worldwide trend of increasing the retirement age considering people’s longer lifespans, but a few months later the party decided to support the proposal. In fact, the socialists would have liked to give the same opportunity to men as well–the typical opportunistic behavior exhibited when it comes to pieces of legislation that will likely be popular with the public. The law was passed on November 11, 2010. As of January 1, 2011, women who were eligible could take advantage of the new system.

Soon enough came the cold shower: Fidesz-KDNP underestimated the number of women who would be eligible and who would take advantage of the offer. The underestimation was substantial. The planners thought that no more than 4,000-6,000 women would be eligible, but shortly after the bill was passed the ministry of national economy calculated that about 24,000 women would be added to the pool of retirees, costing the state 30-35 billion forints.

It was apparent from the very beginning that the new law was discriminatory. According to the Hungarian constitution, men and women have equal rights and yet men with a 40-year employment record couldn’t retire with full benefits. There was a short exchange on this point in parliament where the Fidesz MPs expressed their strong belief that God created men and women to perform different tasks and the gerontology expert also thanked God that the “curse of genderism hasn’t reached Hungary yet.” Yet, MSZP voted for it.

equality

The government estimate of 24,000 women who would retire early turned out to be terribly wrong. By 2013 almost 100,000 women had retired early, which resulted in an 80% growth in pension fund expenses. In 2012 the early retirement madness cost the taxpayers 109 billion forints, and the latest figure is 187 billion.

One reason for the rush to benefit from the provisions of the legislation was the widespread belief that the government would be forced to abolish this very costly campaign promise. Even the women themselves realized that this generous gift might not be sustainable. And yet, during the 2014 election campaign the opposition parties, including DK that swore to refrain from populist promises, talked about the necessity of maintaining women’s special status.

No one stood up in 2010 and insisted on taking the issue to the Constitutional Court for review, although at that time it would still have been possible because the new Fidesz law on the Constitutional Court had not yet been passed.

I call the law that sailed through parliament in November 2010 the “original sin” because now, five years later, Hungarian trade unions, who badly need to bolster their popularity, suddenly discovered that the law that allowed women to retire earlier than men is discriminatory. A private citizen, acting on behalf of the trade unions, asked the National Election Committee to allow a referendum on the issue. Last month, implicitly acknowledging the discriminatory nature of the law, the Kúria, Hungary’s supreme court, approved the referendum question. Activists immediately began collecting signatures, and the signature campaign is going splendidly. There is no question in my mind that the necessary 200,000 signatures will be a cinch to collect. MSZP naturally supports the referendum. After all, already in 2010 they considered it fair to lower the retirement age across the board.

A couple of years ago one of the critics of the original 2010 bill called it a ticking time bomb. Well, the bomb is now close to going off. Suddenly, pro-Fidesz officials are talking about the referendum as “the greatest stupidity” ever. It’s too bad they didn’t think through their campaign promise. They blame the trade unions for seeking cheap popularity. The ministry of national economy, which so misjudged the numbers in the case of the women, is now talking about 150,000 men who might take advantage of early retirement. This would cost 200 billion in addition to the 185 billion currently spent on the women retirees. They figure that the combined effect of the early retirement of both sexes would be like giving them a pension for the nonexistent 14th month of the year. The 13th month of pension had to be abolished in 2009 by the Bajnai government because it almost bankrupted the country.

I must admit I don’t feel sorry for the government. They brought the trouble on themselves, mind you, with the effective help of the opposition parties that didn’t have the courage to stand up and say: we can’t afford this, we shouldn’t do this because the trend all over the world is not to reduce the age requirement for retirement but just the opposite, to raise it.

Jobbik has joined MSZP in support of the trade unions’ initiative. János Volker, deputy leader of the parliamentary caucus, announced a couple of days ago that the party will enlist 17,000 activists to assist in collecting the necessary number of signatures. Fidesz’s immediate reaction was to accuse MSZP of some kind of alliance with the neo-Nazis.

Of course, the question is whether four million people will go out to vote in the referendum. Just as it was not at all difficult to get almost four million people to vote against the 300 Ft copay and a rather small monthly tuition fee, I feel sure that most people will gladly participate in a referendum that will benefit the majority of workers. I suspect that the great legal minds in Fidesz are hard at work trying to figure out some way to avoid holding the referendum. I wonder what kind of trick they will come up with.

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Guest

I have always been perplexed by the way healthy, active and working 55 year old women (and I have friends who fit n this category) blithely let me know how much they get on their retirement, while still working.

Thank you Éva for enlighteming me as to how it has come about – lack of proper research and statistics. Does Hungary not have a proper Think Tank? For a nation which has such a high proportion of Noble Prize winners, is this not a bit perplexing?

Nobel prize winners aside, the identifying Fidesz characteristic of devil-may-care greed, envy and avarice, now officially cloaked within the “constitution”, rules out the possibility of thorough research about much of anything.

Guest

“Nobel prize winners aside, the identifying Fidesz characteristic of devil-may-care greed, envy and avarice, now officially cloaked within the “constitution”, rules out the possibility of thorough research about much of anything.”

The state of the republic neatly compressed into three lines.

Alex Kuli
Guest
Perhaps we ought to address this Nobel Prize story that Hungarians so proudly propound at any gathering that involves foreigners. Specifically, the oft-cited notion that Hungarians have won “the most” Nobel prizes, or “the most per capita,” is patently false. Part of the problem is, who is a Hungarian, and what census should we use to calculate the number of prize winners by population? Right-wingers, with appalling hypocrisy, usually include the Jewish Nobel Prize winners who left Hungary because they were sick of getting spat upon. They even claim these emigrants’ Nobel Prize-winning children as their own. Naturally, Transylvanians and Felvidekers get thrown in as well. If we take a strict definition of “Hungarian,” then the country has produced nine Nobel Prize winners. A loose definition (i.e. including US-born prize winners such as Milton Friedman and Henry Abraham) yields 19 Hungarian Nobel prize winners. Let’s use the loose definition. Nineteen prize winners would put Hungary in 12th place, tied with the Netherlands. By comparison, the U.S. has won 350 and Germany 105. If we use Hungary’s current population to calculate the per-capita figure, we get 19.1 Nobel Laureates per 10 million population. Obviously, countries with small populations come out on… Read more »
Guest

And imho Fidesz wants to return the country to a backwards agricultural hinterland again with a well off ruling class.
If you look at what they did and are doing re education this is almost obvious …

Albrecht Neumerker
Guest

Most of the Nobel laureates lived outside the country. I wonder why?

Guest

@Albrecht Neumerker
August 12, 2015 at 2:26 am

And most of them happened to be of Jewish lineage. Not too many bőgatyás among them. That too, is cause to wonder why.

(Perhaps due to some nefarious conspiracy between devious Scandinavians and the Elders of Zion?)

Albrecht Neumerker
Guest

Dear Bálint, that is the point. For example Imre Kertész got the price because he is jewish say they who not read a word of his work. Well, I live in Sweden and I know that it is not the way it works. Only in some hungarian heads.

Latefor
Guest

Mike Balint,
Is that so? Not too many “bogatyas” amongst the intellectual heavy waits – who once again F*#ked up the world – either! “That too, is cause to wonder why”. 🙂

Maybe it is time for the “bogatyas” to come up with some new ideas!
“That too, is cause to wonder why”.

Ron
Guest

Originally (at least in my opinion) in 1995 the pension age was 52 years and for men 57. Under Gyula Horn it became 57/62 for women and men, respectively. In 2011 it was set at 62 years and 6 months.for men and women.

In 2011 the other condition was that civil servants eligible for pension had to make a choice either to be pensioned or continue to work. It was one or the other, and could not be both. That is why a lot of civil servants (I only know some teachers) choose to become a pensioner rather than continue to work.

Resulting in an increase number of pensioners and reduced civil servant numbers.

Olga
Guest
We reached the point of no return in Hungary. Game over. This means that the proportion of pensioners and people who can’t wait to be pensioners (people over 50) within the voting age population is so high already that their political demands totally crowd out everything else (such as education, infrastructure etc.) which could prepare us for a better future. And some 500-600 thousand young, active people already left the pool of those who would contribute to the pension system (as opposed to take away from it). And the situation is only get worse whether or not this referendum will be successful for Jobbik (that said, this referendum a real, populist and popular move, it’s totally symptomatic that it was Jobbik who came up with it and not the moribund and capitalist leftists parties). Of course, there is one simple solution: lower the amount of starting pension as a percentage of the salary earned. Today in net terms 80% is not unheard of so why the hell would one want to continue working if one could get almost the same amount while being totally free? It’s not really the timing of retirement what is important, but how much the received… Read more »
Member
The thing is, there are half a million people who are also working abroad but are still considered “residents” of Hungary. Those people still contribute to the tax system and send money home to family. At least I think they would still pay tax in Hungary considering the government counts them into employment numbers. Although, I don’t know how accurate you are on the wonderful advantage of seniors considering the average old age pension is between 90000-120000 HUF. I suppose contributing factors such as 40% poverty rate, make it seem rosier than it really is. The problem we are seeing is the fact that the young were prevented from voting in many cases if they were working abroad, so easy to count out their vote and replace it with nationalistic Hungarians votes in the surrounding territories. This is how Orban managed to obtain his 2/3rd majority. One thing I don’t think Fidesz cared about was the future when making his plans. People will just do “black work” to make ends meet and both young and old do that. That money doesn’t get taxed. So if you have a huge portion of the population taking money through pensions and less paying… Read more »
spectator
Guest

“It’s not really the timing of retirement what is important, but how much the received pension will be? If the pension is only say 30-40% of the most recently earned salaries then the scheme may be financed (especially as people would continue to work rather than opt for retirement under such conditions).

While theoretically you are right, practically it could never work.

Many people on pension even today have difficulties to satisfy elementary needs – like eating, cost of housing, etc. – and if the pensions ever going to meet reality and get lowered, it will mean simply death penalty for thousands or more.

As even today the unemployment pretty high, there are regions with hardly any jobs at all, – and no, the ‘communal service’, or whatever the current name of that bad joke doesn’t count -“continuo to work” isn’t really an option. And so far I didn’t even hinted the general health conditions of the average Hungarians over the age of 55, and the conditions of the related facilities…

Pretty much ‘game over’ times, but hey, some other bastards must face the music on a decade or so, not the present powers that be, so who gives a damn?

István
Guest
As readers of this blog who may be resident in the USA may be aware, the U.S. Military has a relatively generous retirement benefit system of which I am a happy recipient. Our defined benefit pension is earned after 20 years of service and benefits pay out immediately upon retirement instead of at 65 or some other fixed age. A solider in the National Guard must have completed 20 years of qualifying service to be eligible for retired pay at age 60. So effectively this means that many officers and NCOs are fully eligible to retire in their middle 40s. Some part time soldiers are getting full retirement from the military while still actively working at age 60. We have had massive debates inside our military about this. With arguments that too many personnel stay in uniform before the 20-year cliff, and too few stay after. Others arguing that the system is coercive because it’s effectively all or nothing, 20 years until vesting is four times longer than what is legally allowable in a private sector pension in the USA. Other arguing that the retirement age for National Guard and Reserves at age 60 encourages too many older officers and… Read more »
Pál5
Guest

The Fidesz is a genius when it comes to turning SZDSZ/Liberal people into pro-Fideszniks. János Kóka on the cover of Magyar Narancs is praising the government with lavish words, András Hajós (the minor media celebrity loved by SZDSZ-types) is criticizing the gay rights activists and liberal elite on the cover of Heti Válasz. And so on. The left could never get any former fidesznik or popular conservative criticize the government on the cover of any media but Fidesz is very successful.

Guest

This is really crazy – typical Hungarian politics …
If there is one way to screw anything, politicians in Hungary will choose this!
For comparison:
Several years ago all parties in Germany agreed (some reluctantly) to raise the pension age from 65 years to 67 years in several small steps. Of course you can retire earlier, but that usually means a lower pension – there are very good info sources which you can decide on, depending on what you want and whether you have other sources of income …

PS:
Of course the whole system in Hungary is screwed – I have the feeling that almost half of Hungarians (maybe even more) work “black” – so many are officially employed part time but really work full time or have a second job.
All that talk about “whitening the economy” successfully is BS!

Member
Meanwhile on Planet Hungary The Orban government is advertising in Afghanistan and Syria. They are telling the population that Hungary is erecting a fence on the souther border of the country … We can only hope that the ads are not in Hungarian … This is from Peter Konok’s FB page (translation by Mutt): Mr. Secretary, do you have a minute? Yes, Mr. President? Look, I was staring out the window here from the Oval office, and there is this strange billboard. There! The blue one! Do you see it? Do you know what this is? Of course, Mr. President. It was made by the Hungarians. I understand. Or don’t understand … Of course not. It’s in Hungarian … And what does it say? According to unofficial translation it says “Hey, nigger! Get out of the White House!” Awkward… And according to the official translation? The Hungarian Embassy’s official interpreter is still working on it. Why? The interpreter doesn’t speak Hungarian?? No, the interpreter speaks Hungarian very well. Unfortunately she doesn’t speak English. I see… And what do the Hungarian want to achieve with this? Our analysts have not yet figured that out. But the world is full of Hungarian… Read more »
spectator
Guest

Will be enough to put some photos of Orbán and his mighty gang on display, with the national symbols, it will do the job without words!

Alternatively the dreadful mascot – which became unemployed recently!
Even could walk along the border every now and then – will scare out the living daylight easily of anyone..!

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