Retiree Dynamics in Slovenia and the Adequacy of Minimum Pensions in Relation to GDP

Demographic ageing and the associated increase in the old-age dependency ratio pose significant challenges to the long-term sustainability of pay-as-you-go (PAYG) pension systems across Europe. Slovenia, as a post-transition economy, faces additional pressures in balancing fiscal sustainability with adequate income protection for retirees. This paper aims to assess the evolution of pension adequacy and sustainability in Slovenia between 1991 and 2025, with particular emphasis on testing five research hypotheses (H1–H5) related to replacement rates, minimum pensions, pension expenditure, and the support ratio. The study applies a longitudinal quantitative analysis based on data from the Statistical Office of the Republic of Slovenia (SURS) and the Pension and Disability Insurance Institute of Slovenia (ZPIZ). Key indicators include the net replacement rate, minimum pension as a share of average wage, pension expenditure as a percentage of gross domestic product (GDP), and the support ratio. Comparative analysis with EU-27 benchmarks is complemented by a regression analysis, correlation analysis, and one-sample t-tests to evaluate the proposed hypotheses. The findings indicate a clear divergence between adequacy and sustainability. Hypotheses H1, H2, and H3 are confirmed: minimum pensions have declined relative to wages, have not kept pace with GDP per capita, and remain significantly below the 40% adequacy threshold. In contrast, H4 and H5 are rejected: pension expenditure as a share of GDP has not increased relative to the EU average, and the support ratio, although declining, remains above the critical threshold of 1.5. These results suggest that fiscal sustainability has been maintained, while adequacy has weakened. The Slovenian pension system demonstrates a structural trade-off between sustainability and adequacy. While fiscal discipline has been preserved, this has occurred at the expense of minimum income protection. Policy implications indicate that there is room for targeted reforms to improve pension adequacy without undermining long-term fiscal stability.