Mathematician and economist Beppe Scienza is giving you a gift for the new year. A piece of advice that will protect the value of the termination benefits belonging to anyone that has not yet transferred the money into one of the pension funds. Spread the word to all workers, to your friends and colleagues; tell them all to keep their termination benefits safe in 2010. When an orange envelope arrives, containing a request for them to move their termination benefits to one of the pension funds, simply refuse to do so. In order to catch a few more unsuspecting people, there will probably be some silent consent clause, so you must respond at all costs. On 6 June 2007, in other words well before the economic crisis hit, this blog posted an article entitled "The termination benefit murmured", containing precisely this advice: "If you work in the private sector and you don’t say anything by the end of June, then your termination benefits will land up in the managed savings funds. Something that should make you tremble with fear, because the mutual funds have been losing money for the past twenty years. Now the pension funds are ready to repeat this disaster. Silent consent is merely a trap. They change the rules of the game without asking anyone anything. It would be like playing the 3-card game with your life’s savings. They are lying when they say that they are building up a supplementary pension. All they’re doing is giving your termination benefits to the managed fund industry to play with.". Those that subsequently kept their termination benefits within the company definitely scored while those that invested their benefits lost a bundle!

Interview with Beppe Scienza:

"The latest news regarding termination benefits has caused major consternation, even though the situation is not as bad as it sounds. The novelty is that the 2010 Budget Bill will be making use of those funds that the companies have paid over to the INPS (the National Pension Fund) rather than retaining them in-house on behalf of their workers, but this is not the worst thing that could happen in that it doesn’t really affect the workers themselves. However, there are other issues that are and will continue to affect or potentially affect the workers’ situation.
The bipartisan termination benefit reform initially decided upon by Maroni and then by Tremonti together with the Berlusconi government and was then brought forward by one year by the Prodi government was one of the most treacherous blows ever aimed at the Italian workers in recent decades.
The real deceit, the true swindle and the real lie that is being spread by a number of the regime’s economists is something totally different and is the basis of the argument being used to convince everyone to opt for the supplementary pension. It goes something like this: Future pensions will probably be low, and therefore inadequate so, in order to supplement the pension income, your termination benefits must be transferred to the pension funds. This is an out and out lie, and a good one at that! It may well be that the pensions payments will be low, although it is very difficult to forecasts what pensions will be like 40 years from now. Even predicting what salaries or even prices will be like in 40 years’ time is practically impossible. However, even if it were true that they will be too low, it is still a lie that you must transfer your termination benefits to any pension fund or insurance-based fund in order to ensure a future supplementary pension. No, you should hold on to your termination benefits and when you reach retirement age, if you wish, you can then invest the funds in a supplementary pension of some sort. At that stage, if the sum you receive is higher than that paid out to the poor devil who chose to transfer his termination benefits to a pension fund now, then your supplementary pension will be greater than his.
There are some specialists in the ignoble art of pulling the wool over the Italian workers’ eyes by telling them certain things that are downright ridiculous. They use a concrete example, someone by the name of Marco Lo Conte, a journalist for “Il Sole 24 Ore”, the daily rag of Confindustria, who tells the people the following, and I quote from page 4 of the Plus24 supplement dated 24 October 2009: “for anyone who doesn't transfer their benefits to the pension funds, the only certainty is a caravan, in other words, the certainty that, when they are old, they will be obliged to live in a caravan without even enough money to buy cat food”, which is allegedly the fate that awaits 18 million of the 23 million Italian employees. Well, to say that anyone who doesn’t agree to transfer his/her benefits to a supplementary pension fund is guaranteed to land up living in a caravan only shows that there is no sense of the ridiculous at the “Il Sole 24 Ore” newspaper.
It would appear that, in 2010, all employees will be receiving an orange form with their pay packets, although the colour of the form is really irrelevant, presumably indicating what their future pension will be. The aim of this orange form is clearly to frighten the workers, but to convince them or drive them to do what, precisely? To invest their benefits in the pension funds or other insurance-based funds. Now this is something that no prudent person should even dream of doing.
Handing your money over to the pension funds involves taking two risks that don’t exist where the benefits are at the moment. The first risk, which we saw very clearly in 2008, is that a collapse in the financial markets would cause a drop in the value of one’s savings. We’re not talking bankruptcy here, because neither pension funds nor mutual funds go bankrupt, however, they can lose up to 90% of their value without being declared bankrupt. The other risk is that inflation once again begins to climb.
What is certain, however, is that in the case of either of these risks, namely either a collapse in the financial markets or rising inflation, or both, which could occur simultaneously because sometimes bad news comes in pairs, those who keep their termination benefits have peace of mind, since the value of the termination benefits does not depend on the financial markets and, should inflation start climbing, the value of the benefits will hold up excellently.
Now Minister Sacconi comes along and reiterates what he has said numerous times before, namely that: “we are about to start another period of silent consent”, in other words, another six months after which, even if a person decides against it, his/her money will automatically be transferred to the pension funds.
The termination benefit scheme works well for the workers, or rather, it works fairly well for the workers and it also works fairly well for the companies, however, it does not increase the bankers’ bottom line because the workers get their money directly from the companies, without any bank in-between to skim off any profits, without making any profits for the insurers, who have nothing at all to do with the process, the fund managers make no profit because they are in fact not managing anything, it also makes no profit for the trade unions because none of their employees are involved, whereas they have people sitting on the boards of the managed funds, nor does it make any profit for the officials of Confindustria or the other employer organisations, who instead sit on the pension fund boards. The termination benefit system also does not make any profits for the university lecturers, nor for the economists, because it runs on its own and the economists are unable to provide their consultancy services or sit on the management boards of the pension funds, in other words, there is no way for them to make money from the system. Therefore, the termination benefits system is something that only works for the workers and the companies, but doesn’t make any money for the others and that is why they have tried to destroy it. Fortunately they have not yet succeeded!" Beppe Scienza