Pensioners Deprived of Three-Month Income

Take It Or Leave It

The decision of the government of Serbia to issue coupons to pensioners with which they will pay for the electric power they consume or fire-wood and coal instead of their pensions for three months which it owes them badly affected the users of the pension fund, but judging by reactions, the explanation from official places that "it is better for them to get coupons than dinars" seems to have made them even angrier.

AIM Podgorica, 6 September, 1999 (By AIM correspondent from Belgrade)

Pressured by an exceptionally difficult economic and financial situation in the country, the government of Serbia decided, due to the lack of money, to deprive the pensioners of the right to pensions for three months (May, June and July) and instead of money to issue coupons with which their owners will be able to pay for electric power and fire-wood and coal. This measure has provoked a sharp reaction of the pensioners who have already lodged a demand for the assessment whether this decision is contrary to the Constitution because, as they say, they were making payments into the pension fund in dinars and not coupons. The step the Republican government has decided to make is the result of a drastic reduction of production in the first six months of this year, but also of the fact that the regime has emptied the pension fund in the course of its long rule by financing unprofitable factories and spending the pensioners' money on construction of modern and luxurious buildings. It is estimated that more than 1200 companies have used this money, but that they have never paid them back, although it had been just a loan.

The current team of ministers of Serbia has no intention to look for those who are responsible because it might "come across" some of its own, but accepted the present situation as a fact which the pensioners have to settle down with. The oldest citizens of Serbia are faced with the dilemma: take it or leave it. Those who refuse to take the coupons can count on getting back the money in an indefinite future when the state gets hold of it. In view of the catastrophic economic situation none of the pensioners have a chance to live that long. The reason for the growing wrath of the pensioners is certainly the fact that on the eve of the increased autumn expenses they are deprived of three pensions. They are even more annoyed by the explanation of prime minister Mirko Marjanovic that this move of the government has in fact improved their financial situation.

Deputy prime minister Vojislav Seselj who once based his election campaign on winning the favours of the pensioners, declared that he envied them because they were at least able to pay for the electric power they use while ministers who according to his words have not received salaries for three months, could not even do that. The pensioners recognised such declarations as cynical, because if it was possible to issue coupons for 1,250,000 pensioners, it was certainly possible to issue them for 30 ministers. Pensioners certainly would not have complained if the ministers had been issued coupons instead of salaries they have not received.

Republican minister of finance Borislav Milacic explained why the coupons were convenient for the pensioners: in order to pay pensions it would be necessary to issue unsecured 3.5 billion dinars, and this would cause high inflation. In relation to the year 1990, real value of the pensions has gone down almost seven times; in other words, it is reduced to only 15 per cent of the average amount in that year. The arguments of the minister of finance, however, cannot pass an even trivial test. First, the prices are going up even without issuing money for pensions. There is twice more money in circulation than there are secured funds. There is about 14 billion dinars in circulation, and this amount has not been reduced by the amount equal to the decline of the social product and the reduced foreign currency reserves. This means that there is too much money, but unfortunately for the pensioners, it is not in their pension fund.

Pensioners, according to explanations of economic experts are suffering the results of the adopted economic policy and the commitment to finance reconstruction of the country of the consequence of bombing from domestic resources. The total amount of money for three-month income of the pensioners amounts to 300 million German marks. In this way, the pensioners' money will be used in the economy twice: first when the factories were built and now for their reconstruction. It can only be assumed that such an explanation would be better accepted than the minister's allegations about what is better for the pensioners. The allegation that it is better for them to receive coupons and not dinars means that by emptying their pockets the regime believes them to be empty-headed, too. With the amount of three pensions which they can spend only on electric power or fire-wood, many of them will pay the bills for a few years in advance. Then they will just have to worry how they will survive that long with no money for sustenance. It is evident that the number of public kitchens has increased lately, but it is a question whether one meal which is issued there is sufficient for survival.

Besides the economic, this move of the government of Serbia has enormous political implications. The pensioners have so far been the most loyal voters of the regime. It is most difficult for the oldest to make up their mind and vote for changes and uncertainty they bring and that is why they preferred to give their votes to those in power although their every next day was worse than the previous. This went on for a whole decade. So far the regime chose to delay payments of pensions, but this offered hope to their owners that some day the debt to them would be recovered. After the latest radical move, this hope has been lost. Since Serbia is facing the possibility of early elections, the question that arises is whether with its decision to pay pensions in coupons the regime has cut the bough it was standing on, because it is difficult to believe that the pensioners will quickly forget this toying with them. Financial consequences for the pensioners who have as it is been in a difficult situation have brought many of them below the verge of survival. With empty stomachs of their loyal voters the regime should not rely on having ballot boxes full of confidence of the electorate.

Although the political opposition is announcing opening of a broad front at which it will clash with the regime formed by three parties in Serbia (Yugoslav United Left-JUL, Socialist Party of Serbia-SPS and Serb Radical Party-SRS), it is more probable that the regime will be threatened by a rebellion of a social nature than by the opposition parties. It is very hard to find a social stratum in Serbia which is satisfied with its economic status, because, along with the pensioners, the teachers, doctors, factory workers... are all threatened. Even those who have until recently lived well off grey economy are becoming worried because the purchasing power of the population has drastically gone down. This is how a specific absurd situation was created in Serbia: there is plenty of food, but the number of the hungry is increasing. According to certain estimates there are more than one million of them.

Ratomir Petkovic

(AIM)