HARMONIZATION OF THE CROATIAN PENSION SYSTEM WITH A EUROPEAN SOCIAL MODEL - PERSPECTIVES AND CHALLENGES

The stability of the pension insurance system today is one of the fundamental problems, both for the Republic of Croatia and other EU member states. The first forms of pension insurance in Croatia were based on the so-called: old-age insurance, while the formal forms were developed in the 19th century. The crisis of the pension system, which was present at the end of the period of socialism, deepened even after Croatian independence. Therefore, at the end of the nineties began the reform of pension insurance, which was completed in 2002. The structure of this system has remained unchanged to date. The authors investigate the compatibility of Croatian pension insurance with the European social model, with the biggest challenges being related to the alignment of the second and third pillars of pension insurance related to the so-called vocational and voluntary insurance and their characteristics. In addition, there is important compliance with the distribution of pension income within the three pillars of insurance and the investment of individual pension fund portfolios. Such harmonization would contribute to the harmonization of the Croatian pension system with the European social model and ultimately the sustainability of pension insurance in the future.