THE REFORM'S MANAGEMENT IN THE SOCIAL SECURITY SYSTEM AND INTERGENERATIONAL AGREEMENT

The European recommendations on social security initiated by Directive no.2003/41/EC are used for the development of occupational pension schemes. They have emerged as a complementary system to relieve the social security system of a part of the tasks and as an alternative for ensuring an adequate benefit to the replacement income. The unitary pension system reformed by merging-absorption of the military pensions and the Ministry of Administration and Interior's staff pensions system is in disagreement with the current European trend. The suppression of service pensions, pensions of civil aviation career and of the diplomatic staff decreases the interest to voluntary support the redistributive pension system. The seeming contrary short-term interest of active people and the elderly can not be labeled as a disagreement between generations, although the utility functions being presently reported are different. In this study, I illustrate that Management of pensions' reform in Romania leads to widening the gap between the contributions paid and pensions and to increasing the financial imbalance in the Public Pension System.