“Pensions, Towards Albania 2030” was the next public discussion held today at the Prime Minister’s office, led by Prime Minister Rama, focusing on the importance of the fight against wage informality, which is seen as the main enemy of pensions.

“It is essential to create a large social front involving the government, companies, and individuals because social insurance, from which the pension fund derives, is an obligation—not only a legal obligation but also an unavoidable one—to create the possibility for the chain of solidarity to function. This means that social insurance is the primary obligation of anyone receiving a salary, and as soon as that obligation is fulfilled, it goes directly to someone receiving a pension,” the Prime Minister emphasized regarding the overall process.

Meanwhile, the Minister of Economy, Culture, and Innovation, Blendi Gonxhja, a member of the working group on pensions, stated that “It is of utmost importance to ensure that every employer is aware of their responsibilities and pays the contributions due to every employee, as agreed upon, and as required by law.”

The Minister for Entrepreneurship and Business Climate, Delina Ibrahimaj, presented figures and facts about the government’s concrete measures to improve the overall business climate through fiscal incentives.

The meeting was also attended by heads of institutions and experts that are part of the working group on pensions.

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Prime Minister Edi Rama: Greetings to everyone! Today is the third day of public discussions regarding the topic of pensions. These discussions aim to provide an opened, and detailed overview of the pension landscape for all pensioners, primarily, but also for society as a whole, to understand the complex nature of this area of revenue management that we create and the significant challenges we face in addressing the need to increase pensions.

On the other hand, it is essential to emphasize that in a process like this, a broad social front is necessary in the best sense of the word, among the government, companies, and individuals, because social security contributions, which subsequently fund pensions, are an obligation—not only a legal one but also a moral necessity—to create the opportunity for the chain of solidarity to function. This means that social security contributions are the primary obligation of anyone receiving a salary, and that obligation, once fulfilled, goes directly to someone receiving a pension

I will now pass the floor to the Minister of Economy, and then we will continue with the other attendees here.

Here we have an important interest group, which is essentially the other side of the coin regarding the need to increase pensions: entrepreneurship. Just yesterday, I happened to be in a service environment in Tirana and I asked the owner what the minimum wage was. It was 600 euros for the sanitation worker and 1,120 euros for the average wage.

I bring up this example to illustrate that these are the real wages in the respective sectors; this is the actual wage across all such services in Tirana, and slightly lower in other areas. However, when it comes to the declaration of wages, it is completely different. Now, we are the only country in our region that has zero taxes for small businesses. Interestingly, there is no other place in the world, at least in the region—where only 10% of businesses pay profit tax.

In Albania, only 27% of businesses pay VAT—so 1/4 of businesses—while 2/3 do not pay VAT at all, for the same reasons I mentioned, along with all the benefits provided to businesses.

Do you know how much this amounts to, in terms of revenue for businesses from these incentives? The total amount that the government has forgone and has not collected to put into the state budget is 1.1 billion euros per year. 1.1 billion euros. And we are talking about 1.1 billion euros in the budget of the Republic of Albania, not in a budget where 1.1 billion euros might not be that significant.

The economy is driven by the entrepreneurship, not by the government, in terms of creating jobs, and the overall economic growth. However, the problem is that we are currently in a situation where a quarter of the budget, which amounts to a significant portion, goes to pensions, and we are lacking the legal contribution of entrepreneurship in this area.

Now, how do we handle the fact that for 17 sectors of the economy, there are 156,000 employees that declare a salary of 50,000 Albanian lek, knowing that this salary is exempt from taxation? There is no logical reason to accept this.

However, from this deception and this criminal approach towards pensioners, we have a very large gap that we are compensating today by allocating half a billion euros to supplement pensions, because without this half a billion euros, pensions cannot be provided at their current levels. It’s easy to speak when you have nothing tangible; it’s easy to make promises when you know they won’t be fulfilled; it’s easy to offer solutions when you lack the credentials to diagnose the problem. But the issue of pensions cannot be solved with good intentions alone, nor can it be resolved by thinking, “let’s increase them today,” without considering that tomorrow you might lead everyone into a complete abyss.

On the other hand, the problem of pensions and the increase of pensions cannot be solved by taking from our children. We do not want to carry out a repressive operation, fully justified for the sake of truth, but we want, first and foremost, for businesses to receive a very clear message. We have made significant progress; it’s not as if we started today.

However, Albania has made more progress than is reflected in this area; the economy has grown more than what is shown as a progress here, and from this economic growth, you are the first to benefit in ways you never imagined you would in the Republic of Albania, and you know this very well. Those employed in the public sector are benefiting, because there is not such a thing like “I’ll give you part of the salary tax-free. Certainly, all communities are benefiting from the investments made by the state, but pensioners are not reaping the rewards of this economic growth. This is the critical moment of all this economic growth.

All those who contribute to economic growth should receive their share of that growth, while pensioners are pensioners because they contributed in the past. Now, for the contributions they made previously, they should receive what is rightfully theirs. This is the moment when pensioners should receive what they are owed. We will certainly do what we have to do, because it’s not a matter of opening the door for pensioners to participate in the growing economy, but for us all to do what we need to, there are two things: one is to allocate a larger budget for pensioners, and the other is to take from you what we need to give to the pensioners.

The message must be understood that we will no longer accept salary declarations that we do not trust. It’s that simple. And on what basis? Not arbitrarily. Based on what market analyses indicate. Builders who declare a salary of 60,000 lek that does not actually exist must understand that it will not be accepted; the declaration will be returned, and they will be told, “Correct it, you made a mistake.” If they do not reflect this change, then they will have to face situations similar to what the electricity thieves encountered before.

The declaration of salaries must be serious and truthful, and we are all witnesses to this. Salaries have been disclosed in public due to a compromised digital system, and as a result, there has been an increase in declarations because it became clear.

Since the beginning of this year, we have convened a large working group with international experts, studying best practices to answer the pensioners’ question, “What will happen to us?” And as for what will happen to them, no one else can provide that answer except this government.

Regarding small businesses, we only ask them to pay social and health insurance, with no taxes involved. Self-employed individuals essentially “steal from themselves” by not contributing to their future pensions. This is unacceptable, and we will take drastic measures against any small business that fails to pay social security, potentially leading to the closure of their operations. While tax discussions are possible, social security contributions are non-negotiable. We currently have a significant number of businesses that owe money to pensioners, and we will not allow businesses to use debt restructuring as an excuse to avoid their obligations. We urge businesses to make honest declarations, as we will not tolerate misleading practices that insult our intelligence—especially when construction projects are sold for thousands of euros while reporting absurdly low wages.

These were the points I wanted to share, and I sincerely thank you for coming here to help us convey this message. I apologize to those who don’t belong to the broad category of pension thieves, as many companies are declaring properly. I verified a particular example that surprised me, confirming that my concerns were justified. So, I extend my apologies to those who deserve it. However, for the majority, please take seriously the message from the Tax Directorate; it marks the beginning of a constructive interaction with you. We are prepared to take dramatic action against those who do not take this seriously.

Thank you all for being here.

I can’t conclude without inviting any questions, comments, or even criticisms—everything is welcomed. I understand if there are no questions, as our speeches have been lengthy and you’re eager to return to your work. Once again, thank you, and remember, for anything beyond this topic, you have the government and institutions at your disposal. We are here to ensure that social security contributions are paid correctly.

Thank you!