Italian doctors’ scheme Enpam is set to end the current financial year with losses of €564m, as a consequence of the war in Ukraine, increase in energy and food prices, and surge in interest rates, it said.
The National Assembly has also approved the fund’s budget for 2023, expecting a return to positive results, prudently estimated a €115m return, it added.
Next year, however, the pension fund expects, for the first time, a negative difference between the amount of pension benefits paid and contributions.
Furthermore, the National Assembly has examined a proposal to reform Enpam’s mandatory minimum contribution in its Quota A fund, setting the vote for next April.
Payments for 2023, therefore, remain those already planned on the basis of inflation and rules in place, from €129 per year for enrolled students to €1,734 per year for taxpayers over 40 years of age.
The proposal to reform contributions in the fund aims to structurally stabilise the Quota A fund catering for the entire medical profession, it said.
As per the financial forecast for this year, approved by the National Assembly last year, Enpam expected operating returns of close to €207m in 2022, resulting mostly from interest, dividends, equity investments, and collective investment undertakings, for a total of €250m, with potential losses from trading for approximately €35m, management fees of €17m and taxes worth €61m.
According to the so-called reclassified annual economic budget, Enpam expected pre-tax returns for this year of €372.21m, down from €529.35m in 2021, and a financial surplus of €355.61m, down from €507.95m in 2021.
The ratio between contributions and benefits paid is expected to be positive in 2022 at €158.93m, but lower, however, than the difference recorded in 2021 of €721.49m, according to last year’s preliminary financial statement.
Contributions will record a decrease in 2022 because of a reduction in mandatory contributions for Quota A fund, with a smaller number of taxpayers over the age of 40 paying those contributions, the pension scheme explained.
Enpam said last year it would continue to build its portfolio based on liability-driven investment (LDI) strategies, under constant monitoring to be able to carry out strategic shifts or to review planned investments.
In the real estate sector, Enpam continued to divest from residential property through disposals managed by Enpam Real Estate, focusing instead on indirect investments.
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