Striking claim from Ali Babacan regarding the private pension system

DEVA Party Chairman Ali Babacan has made a significant claim regarding the private pension system. Babacan stated that under the new tax law, there are plans to grant President Erdoğan the authority to reset the state contribution in the Private Pension System (BES) to zero.

The Law on the Private Pension Savings and Investment System was adopted on March 28, 2001, and published in the Official Gazette on April 7, 2001. Starting from January 1, 2013, state contributions began to be provided for Turkish citizens and Blue Card holders. This rate, which was 25 percent from 2013 to 2022, was increased to 30 percent through a legal regulation.

"THEY WILL RUIN THE SYSTEM"

Babacan stated that this regulation would jeopardize the retirement savings of 16 million people. "They will ruin the system. They will let down our citizens who trusted the state, chose BES as a long-term savings method, and have been paying premiums for years," he said.

The bill is currently being discussed in the TBMM Planning and Budget Committee. Babacan claimed that a clause would be added including the authority to increase the BES state contribution to 50 percent or reset it to zero, but that this authority would be used to reset it. He added that this situation would be a major blow to the private pension system.

CURRENT STATUS OF BES

The total size of the fund amount of participants and the state contribution fund amount in the Private Pension System (BES) has reached 1 trillion 850 billion 300 million liras. Together with the Automatic Enrollment System (OKS), the total fund size has reached 1 trillion 966 billion 883.7 million liras. As of October 17, the number of participants in BES was recorded as 9 million 982 thousand 691.