By Zoran Radosavljevic
ZAGREB, Sept 12 (Reuters) - Croatia will start scrutinising 300,000 disability pensions next week to crack down on fraud, as part of the new EU entrant's efforts to show it is fighting corruption and tackling a rising budget deficit.
"More than 25 percent of our pensioners have disability benefits. We are not more prone to sickness, nor are our labour conditions worse than elsewhere in Europe, so it is clear that some of those pensions were illegally acquired," Labour and Pension Minister Mirando Mrsic told Reuters on Thursday.
Croatia joined the European Union in July and the government acknowledged on Thursday it would not be able to reduce the budget gap this year because of a long recession and its own efforts to repay earlier debt.
Corruption and cronyism were widely tolerated until a previous government launched an anti-graft drive in 2009 to keep the EU accession talks on course. The current Social Democrat-led cabinet is also keen to show it is challenging fraud.
"We first started in our own backyard, combing the ministry and the state pension fund. We found cases that were kept in drawers to avoid inspection, cases where husbands provided expert opinions for wives and family members, cases with no medical documentation at all," Mrsic said.
Before the country of 4.4 million people gained independence from Yugoslavia in 1991 it had some 2 million workers and half a million pensioners, easily supporting a pay-as-you-go pension system.
Now the number of pensioners is only a fraction below the 1.4 million of those employed, as socialist-era industry has largely collapsed and successive governments allowed early or disability retirement.
Some 36 billion kuna ($6.3 billion), almost 30 percent of the state budget, is needed each year for pensions. Only 19 billion kuna is collected from obligatory pension payments and the rest is funded from the budget.
Until recently, disputed disability pension cases regularly ended up in court and pension payments were abolished only after a court ruling to that effect, which could take years.
"Now we will be able to halt the payment immediately and the burden of proof will lie on the pensioner. Furthermore, all suspect disability pensions will be subject to revision every four years," said Mrsic, adding that he has set up expert "CSI teams" of lawyers and doctors to vet suspect claims. ($1 = 5.7045 Croatian kunas) (Reporting by Zoran Radosavljevic; Editing by Ruth Pitchford)