The matter was among the medium and long-term challenges raised in the BCL’s 250-page budget opinion.

BCL president Gaston Reinesch participated in an exchange of views with the parliamentary finance and budget committee on Monday.

During discussions, Reinesch repeated the bank’s concerns on the general pension scheme beyond 2049. According to BCL’s analysis, the reserve would fall below the legal limit, set at 1.5 times expenditure by 2044.

Even if the draft 2020 budget allows for a substantial cost of ageing by increasing health and pension expenditure, Reinesch stressed the need to reform the pension system.

He also raised concerns about the rising cost of housing in Luxembourg. From Q4 2017 to Q4 2018, house prices rose on average 10%, continuing a trend that is progressing unabated. Reinesch said rising house prices were a “serious problem, with increasingly serious consequences.”