At today’s session in Sarajevo, the Government of the Federation of BiH, at the proposal of the Federal Ministry of Labor and Social Policy, adopted the Draft Law on Amendments to the Law on Pension and Disability Insurance and submitted it to the parliamentary procedure under the abbreviated procedure.
As the proposer explained, the amendments to the Law cover all pension beneficiaries in the Federation of Bosnia and Herzegovina, all types of pensions and all categories of pensioners, from the lowest to the highest pension, in accordance with the Constitution of the Federation of BiH and the principle of non-discrimination, because the right to a pension is an earned right.
The most important change relates to a new, fairer model of pension adjustment, which combines the growth of average salaries and the growth of the consumer price index in the ratio of 60/40 or 40/60, depending on which option is more favorable for pensioners at a given moment, thus linking pensions to real economic indicators and ensuring a more stable and secure growth of income.
In its amendments, the law introduces a semi-annual adjustment of pensions, which will be carried out twice a year, on January 1 and July 1, starting from January 1, 2026, with an estimated total increase in pensions in 2026 of around 17.2 percent, with the January adjustment amounting to around 11.6 percent, while the June adjustment will amount to an additional 5.6 percent.
The proposed amendments further expand the right to compensation for funeral expenses, which will no longer be limited to immediate family members, but will belong to every person who actually incurred those expenses, while the amount of compensation is defined as the average pension paid in the previous month.
All financial obligations arising from the new adjustment model have already been planned in the Budget of the Federation of BiH, and after the transition of the Pension and Disability Insurance Institute to a treasury business model, pension payments are made directly from the budget of the Federation of BiH, which additionally ensures the stability and security of the pension system. Specifically, for changes to the Law, the Government had to secure an additional one billion and one hundred million BAM in the budget, and the total amount planned for pension payments in 2026 is around four and a half billion BAM.
By adopting the amendments to this law, the Government of the Federation of Bosnia and Herzegovina showed clear social sensitivity and confirmed that it assumes the responsibility and obligation to, together with pensioners’ representatives, continuously work to improve the financial position of pensioners, while this law is proof that the Government stands by its promises and publicly stated commitments.
This law enters into force on the eighth day from the day of its publication in the Official Gazette of the Federation of Bosnia and Herzegovina, and it will be applied from January 1, 2026. year, it was announced from the FBiH Government Office for Public Relations.
