Turkey's Complementary Pension System faces delays and wage concerns

The Complementary Pension System (TES) in Turkey faces ongoing delays and uncertainty. Originally planned for 2024, the implementation timeline has been pushed to 2026 as part of the Medium-Term Program and Presidential Programs. The proposed reform aims to transform the existing Automatic Participation System (OKS) into a second-tier retirement model that includes employer contributions, while restructuring Private Pension System (BES) and OKS funds.

Significant concerns have been raised regarding the economic impact on workers and employers. The proposed model suggests a 3% contribution deduction from employee wages. Experts note that with the current minimum wage at 28,075 TL and the hunger limit exceeding 36,940 TL, such a deduction could further reduce net income for vulnerable workers. For employers, the system would introduce additional costs, potentially raising the total premium burden to 44.75% by January 2026.

Despite the scheduled targets, no official legislative proposal or comprehensive draft has been submitted to the Grand National Assembly of Turkey. The upcoming budget discussions in the Parliament are expected to prioritize other fiscal matters, making the passage of TES within the current year unlikely. Meanwhile, data shows that the combined fund size of BES and OKS has reached approximately 2.6 trillion TL, with over 18 million total participants.