The law should apply to everyone equally; the insurance company disregards this rule in the case of State hospitals

Bratislava, November 20, 2020 - The Social Insurance Agency receives more funds from levies each year than flows into the State budget from VAT. However, the Government does not have information how much of the premiums leak out and how to improve the country key contribution system.


The Supreme Audit Office of the Slovak Republic (SAO SR) draws attention to the lack of analysis in the contribution gap in the conclusions of the insurance company's income audit. The insurance company collects more than EUR 8 bn annually later distributed to pensioners, the sick or the unemployed. Other insurance funds and special-purpose transfers from the State budget have long offset the deficit of the pension fund.


The national authority for audit and control has identified the risk associated with non-compliance with the constitutional principle of equal treatment of all interested parties by the management of the insurance company. The Social Insurance Agency (further SIA) did not act for a long time against State hospitals that did not pay compulsory insurance premiums for their employees.


The auditors also identified shortcomings in the SIA relationship with private pension management companies, where almost half of the costs associated with the collection of premiums for the Second Pillar II is borne by the SIA budget and not by private companies.


The basic source of income for SIA is insurance premiums for sickness, pension (old-age and disability), accident and guarantee insurance, unemployment insurance and the solidarity reserve fund - the so-called social security contributions. A comparison of the funds management in 2015 to 2018 confirmed that while the largest fund - old-age insurance ends annually in the red, other funds are usually in green.


The SAI then uses the surpluses, together with financial assistance from the State, to address the deficit in old-age insurance. The SAO SR states that the total balance of pension insurance would have climbed cumulatively in 2004 to 2017 to EUR 25 bn if not for the help by the State and other funds.


The full text of the press release about this issue in Slovak language is available here. Use the Google icon in the top bar for automatic translation.