NEGATIVE TREND IN PENSION INSURANCE BUREAU HALTED - SAYS MANAGER

ZAGREB, Oct 26 (Hina) - Parliament's House of Representatives began Thursday's session by debating a report on last year's work of the Croatian Pension Insurance Bureau (HZMO). Some 1.4 million people are registered with HZMO, including about 420,000 who pay minimum contributions and 10-20 percent none at all, said HZMO manager Dunja Vidosevic. She added the situation was made even more difficult by the fact that pensioners had exceeded one million, making the insured-pensioner ratio 1:1.38. Vidosevic said clearing losses, 1.6 billion kuna ($177 million) when she became manager, had been the bureau's main task in recent years, and that it had affected the payment of and late pensions. The bulk of the losses has been cleared, last year's collection of contributions rose by five percent, bringing the deficit to 105 million kuna ($11.7 million) by the end of 1999, said Vidosevic. She pointed out the negative trend had been halted, but that HZMO would continue having problems as long as the economic situation remained unstable. Vidosevic told the lower house a World Bank analysis said HZMO's organisation was bureaucratic and obsolete, and that managerial skills were insufficient. She urged restructuring to increase effectiveness, but said it would be impossible without radical steps. (hina) ha