Croatian pensioners, for a number of reasons, receive very low pensions, especially compared to Western European retirees. For example, in Austria, the average net old-age pension is around €1,700, which is significantly more than even the average net salary in Croatia.

Citizens of the European Union share a common market and set of rules, but the differences in average pension amounts among member states are vast. Although the Croatian pension system has been ranked among the top 20 in the world, the amounts received by pensioners are far from sufficient for a normal life and are significantly lower compared to most EU countries, writes Mirovina.hr.

Average Old-Age Pension in Austria Around €1,700

According to official data from national pension institutions, the average net old-age pension in Croatia is €631. In neighbouring Slovenia, the amount is significantly higher, at €959. Italian pensioners receive around €1,100, while Austria leads with an amount of approximately €1,700 — considerably more than, for example, the average net salary in Croatia, which in January this year stood at €1,392. In Germany, the average net old-age pension is around €1,300.

In Croatia, the average old-age pension represents only about 45% of the average salary, and that percentage used to be even lower, as previously reported. This is a result of low wages during working life and relatively short working careers, often interrupted by unemployment or informal work, reports N1. 

Italian, Austrian and German Systems in Comparison

Although Italian retirees receive more than those in Croatia and Slovenia, the country faces similar issues to other European nations, such as demographic aging and high public debt — factors that could threaten the long-term stability of its pension system. Austrian retirees benefit from one of the most generous pension systems in Europe. Their high pensions result from relatively high contributions and a long working career — up to 45 years. In Austria, 22.8% of gross wages go towards pension insurance. Also, most Austrian pensions are not additionally taxed, increasing the actual amount pensioners receive.

How to Fix the Croatian Pension System?

Germany, long seen as Europe’s economic powerhouse, has lower average net old-age pensions than Austria — around €1,300. The German system is increasingly shifting toward private savings. The net pension amount also heavily depends on tax burdens and the individual’s total income.

The comparison shows that pensioners in wealthier countries receive much more, enabling them to maintain a higher standard of living. Although differences in the cost of living partly offset the real gap in purchasing power, they do not eliminate it entirely. Croatian pensioners remain among the most socially vulnerable in the EU when comparing the ratio of pension income to living costs.

These figures clearly indicate the need for deep reform of Croatia’s pension system, as well as the creation of conditions for better wages and working environments, so that future generations have a better chance at a dignified old age. However, opinions on how to reform the pension system are divided. Some advocate strengthening private savings through the second and third pillars, while others argue that the second pillar should be abolished and the system reverted to its pre-reform state from about 20 years ago.