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Italian Workers to Put about 25 Percent
Severance Pay in Pension Schemes
Forbes magazine
Italy
February 6, 2007
Twenty-four pct of Italian workers favour putting their severance pay funds, so-called TFR funds, into private pension schemes, according to a poll by Il Sole 24 Ore newspaper.
Under a reform, employees have until June 30 to explicitly say whether they want TFR funds to go to private pension funds. The government intends to take over part of TFR left with the companies they worked at.
Il Sole said 53 pct of the 1,000 workers polled favoured leaving the funds with the company they worked at, 24 pct putting the cash in pension funds, 22 pct had not yet decided, and 1 pct did not reply.
The government has estimated that out of 18.9 bln eur of TFR funds in 2007, 36.6 pct would go to private pension funds, 31.7 pct would be transferred to a government fund, and 31.7 left with firms.
Asset management firms are hoping to increase their pension fund business via the TFR reform.
nigel.tutt@thomson.com
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