Amendments to the Pension and Disability Insurance Law Adopted, Minimum Pension Depends on Years of Service

(Patria) - The House of Representatives of the Parliament of the Federation of Bosnia and Herzegovina adopted last night the Proposal for Amendments to the Law on Pension and Disability Insurance.

The proposal was adopted unanimously with 86 votes "for". It should be noted that the FBiH Government rejected all amendments to this draft law.

The adoption of this Proposal will bring significant changes to the calculation of the minimum pension for those who do not have 40 years of service.

According to this draft law, it is defined that "the lowest old-age pension depends on the length of pension service and is determined as a percentage of the average pension paid for December of the previous year, adjusted in the year of entitlement."

The new model, or rather the formula for pension adjustment, combines the growth of average wages, instead of GDP, and the growth of the consumer price index in a 60/40 or 40/60 ratio, depending on which factor is more favorable for pensioners.

Pensions will be adjusted twice a year, on January 1st and July 1st. According to the adjustment from January 1st, 2026, pensions will increase by almost 11.6 percent.

It is further defined that for less than 20 years of pension service, the pension cannot be lower than 60 percent of the average pension of the previous year; for 20 years of pension service or more, but less than 25 years, it cannot be lower than 65 percent of the average pension; for 25 years of pension service or more, but less than 30 years, it cannot be lower than 70 percent of the average pension; for 30 years of pension service or more, but less than 35 years, it cannot be lower than 75 percent of the average pension; for 35 years of pension service or more, but less than 40 years, it cannot be lower than 85 percent of the average pension; and for 40 years of pension service or more, it cannot be lower than 95 percent of the average pension paid a year earlier.

Regarding veterans, the amendments retain the current minimum pension amount for the veteran population, which, in accordance with the Law on Pension and Disability Insurance, will continue to be adjusted and increased, and by 2026, the minimum veteran pension should amount to around 700 KM.