Modelling of the Future Development of the Total Amount of Premium Paid and Total Amount of Old-Age Pensions in the Czech Republic.

The paper present a simple model of the future development of incomes and expenses of the old-age pension system in the Czech Republic (so called 1st pillar). The projection is based on the results of the latest available population projection published by the Czech Statistical Office in 2013. The expected number of employees (payers of the old-age insurance premium) is estimated on the basis of the sex and age structure of people in productive age and expected employment rates. All people at the age higher than retirement age are expected to receive old-age pension. The permanent increase of retirement age according to the present legislation is assumed. The computations show that the financial deficit of the old-age pension system would reach maximum values in the fifties when the numerous generations born in the seventies of the last century will reach the pension age. But in the last two decades of the present century the proportion of pensioners would be lower than at present times.