The Ukrainian Parliament this fall will consider the government draft of pension reform. Under the bill, seniors will recalculate the payments under the new formula. The average salary that is taken into account when calculating the payments, will increase almost three times, but it will reduce the assessment ratio experience. Experts say that those Ukrainians who had not yet retired, after the reform will receive less, but current retirees can “get rich”. The website “Today” found out who after the reform will be able to gain more than 1,000 hryvnia.
How many people will get “modernized” retirement
If the pension reform will take on second reading and in General, in October the Ukrainians waiting for the “modernizing” of pensions. Only a raise will get 5.6 million pensioners. More than a million of them “get rich” more than 1,000 hryvnia. The majority of Ukrainians “retirement” (about 1.9 million people) will receive an increase from 500 to 1000 UAH.
To whom and how increase the payment:
- increase to 200 UAH 1.3 million pensioners
- from 200 to 500 UAH 1.2 million
- from 500 to 1000 UAH 1.9 million
- more than 1000 UAH 1.1 million
As explained by the website “Today” in the Ministry of social policy, large surpluses would get in the first place Ukrainians who retired prior to 2007, had a high salary and significantly more than 30 years of experience. Recall that in the calculation of a pension average salary in Ukraine in three years, multiplied by the ratio of own wage to the average in the country (how many times the salary is more or less average). The resulting figure is multiplied by the experience and 1.35%. After the reform, the formula will change – instead of 1.35% in the formula will use the assessment ratio of 1%. But when you are clearing obsolete, the average for three years of salaries will be replaced by actual.
Ukrainians pensions are indexed to the level of the minimum pension. For example, if the minimum pension of 1000 UAH and social standards index by 10%, and those with a pension of 2000 UAH, and the one who gets to 1000, will add 100 hryvnia. As a result, every year the gap between ‘large’ and the minimum pension is reduced.
For example, a Ukrainian who worked for 40 years and had paid twice the average in 2007 could claim a pension at 1293 hryvnia. At the time this pension was three times higher than the minimum. At the moment the pensioner, after all the indexing can obtain 2135 hryvnia is 1.6 times higher than the minimum. That is, in 10 years such a pension has depreciated by almost two times.
Who after “modernizing” receive an increase of 1,000 hryvnia
An increase of more than 500 hryvnia can get Ukrainian, who retired before 2007, had paid at least two times higher than the national average. For example, the pensioner who retired in 2007, was earning three times more than the average salary and worked for 40 years, now can get around 2780 hryvnia, and after the “modernization” – more than 4,500. That is such pensioner will receive a boost of approximately 1,700 USD.
However, these Ukrainians not so much. Now be paid three times more than the average, according to state statistics, get programmers, employees of air transport and managers of top and middle management.
But even with 40 years of experience and average salary of a Ukrainian, who retired before 2007, when “modernizing” can get a raise only 20 hryvnia. And if you have this Ukrainian has 45 years of experience, the increase will amount to 205 hryvnia. It should be noted that the calculations were made without regard to pension supplements for excess length.
The website “Today” come up with a rough calculator of pension after the reform, which allows to calculate the possible payout.
How many years of experience You will have time to work out:
Wages at the moment:
The result: –
By the way, the Pension Fund takes into account when calculating the pay ratio of Ukrainians to the national average for each month. The calculation of the “pension calculator” to show a ballpark figure, provided that the level of wages relative to the national average does not change. The calculator also does not take into account possible surcharges for excess length. The formula takes into account the average wage relevant for 2017.
“The remains of about three million pensioners, who in October did not receive any allowances. First of all, people who retired in the last three or four years: in 2014, 2015, 2016 and 2017. They have a base salary not so much outdated, but if you count with a reduction in the estimate one year of experience, the insurance part of their pensions will be even lower than it is now. They certainly will not reduce the total amount of pension, but additional money as a result of modernization, they will not receive. In addition, new pensioners basic amount of pension, as a rule, more than the subsistence minimum, i.e. the revision of minimum pension, they too will give nothing”, – says senior researcher of the Institute of demography and social studies Lydia Tkachenko.
What will happen with the pension system of Ukraine
In the next few years, the Cabinet of Ministers plans to launch a mandatory funded tier. Under current law, must operate three levels: solidarity (working now), mandatory funded and voluntary funded. The final level is private pension funds. In them have taken part about 800 thousand Ukrainians. Only in a country of 26 million able-bodied that could potentially “save for retirement”.
As I’m sure the pension expert Galina Tretyakova, only the joint level may not provide the Ukrainian high pensions. The only way to ensure a dignified old age – to run a cumulative level. Then the Ukrainians will have 22% of their salary to give to the solidarity pension (payments to current retirees) and a certain percentage of salary to defer to your personal account. To use the collected funds will be possible after reaching retirement age. Thus, Ukrainians will be able to receive two pensions from the solidarity and savings levels.
The Ministry of social policy they say: to introduce a cumulative level only after the Pension Fund deficit will be completely eliminated. Last year it reached 145 billion, and this year, according to the budget of the Fund, at 141 billion.
Earlier, the website “Today” I wrote about how to collect on the pension itself.