Since the beginning of 2015 in the State Duma Russian Federation Questions about introducing changes as part of pension reform have been repeatedly considered. Bills were introduced throughout the year, but the situation never reached a certain consensus.

This government inconsistency is due to a number of reasons. Unity is observed in only one thing: – the measure is necessary, but the question of changes in legislation regarding indexation and increase in pensions, changes in the retirement age remains open.

According to experts, main reason The reason for which the pension reform has not yet been adopted is the upcoming government elections. Neither the president nor the coalitions formed in the State Duma are ready to risk the most valuable votes in the country - the votes of pensioners. After all, by turning this category of the population against themselves, the result can be very unexpected. And this, accordingly, does not benefit anyone.

Fear of social protest from society, the instability of the economic situation in the country, the continuous search for solutions to cutting the state budget - all this does not allow us to accept and implement a number of issues related to pension reforms for 2016-2017.

Planned innovations within the framework of pension reform

The priority issues in the government apparatus are:

• Raising the retirement age.
• Planned indexation of pension payments.

Both the first and second questions cause a storm of protests not only among the population, but also among individual parliamentarians who defend the interests of the people and at the same time make statements that are undoubtedly part of election tactics. After a meeting held in the Kremlin, Vladimir Putin clearly stated that in 2016, raising the retirement age will not come into force. But in the future, this measure, according to the president, will still be required.

On the one hand, politicians are looking for everything possible ways to reduce the state budget, on the other hand, they affect those categories of the population that already need additional social protection. Making changes to the “” project, indexing pensions and salaries of civil servants and the military are not the last innovations considered when planning distribution budget funds for the period 2016 – 2017

Increase in retirement age 2017

As of 2015, there is a law in Russia according to which persons who have reached 55 years of age for women and, accordingly, 60 years of age for men, can count on a pension. Conditions based on accrued length of service also apply. In this case, pension coefficients are calculated, the amount of which is calculated from the minimum number of years worked according to the work book.

Thus, in 2015, the minimum coefficient allowing retirement with further payment of state support is 6.6, which corresponds to 6 years of official employment. Accordingly, for 2016 the coefficient has already been increased to 9 points (7 years), in 2017 – 11.4 (8 years). It is important to note that these indicators are the same for both men and women. In the event that there is no experience at all, according to the legislation of the Russian Federation, such a person can only count on receiving the minimum minimum. This is the so-called social pension, which is provided for all persons over 60 and 65 years of age (indicators for women and men, respectively).

Now we're talking about about the feasibility raising the retirement age by 1 and 2 years A. Some politicians believe that, due to socio-demographic factors, it would be appropriate to increase this indicator by 5 years for all categories of the population. In any case, not a single bill has been adopted unanimously by either the State Duma or the Kremlin.

Moreover, this area of ​​pension reform will not be developed in 2016; as for 2017, the question remains open. Only preliminary calculations are known, according to which state budget savings if the retirement age is increased will amount to more than 150 billion rubles per year.

Indexation of pension contributions

The need to index pensions in Russia to the level of inflation is the most important step, opening the way to reducing budget expenditures for 2016. Experts already at the end of 2015 predict an increase in inflation in Russia by 12%. This is exactly how much, according to officials, it is necessary to increase the indexation of pensions. They want to introduce this idea as early as February 2016, and this figure can only increase.

Alexey Kudrin, who previously held the position of Minister of Finance, said that such manipulations would entail additional costs, which, in his opinion, could reach 650 billion rubles. Accordingly, the financial department is unlikely to be able to allocate such funds.

That is why, as a consequence of the calculation data, instead of 12% indexation it is proposed to introduce 4%, compensating for this by increasing the retirement age.

Anton Drozdov submitted a corresponding bill to the State Duma for consideration. The Chairman of the Board of the Pension Fund proposed an indexation rate for 2016 of 5.5%, for 2017 – 5.2%. In addition, he proposed maintaining the size of pension contributions, which in 2015 amounted to 22%. It is also worth noting that when setting up the 2016 state budget, changes in the country were taken into account. In particular, the budget includes funds for the payment of pension benefits to persons officially residing in the territory of Crimea.

Politicians' opinions on reform

The decision of the President of the Russian Federation to reject the law on increasing the retirement age was supported by many politicians. In particular, Alexey Ulyukaev, who holds the position of Minister of Economic Policy, said that such a measure is correct, but it should be postponed at least until the end of 2016.

There are also those who actively advocate the implementation of this reform. Thus, the Ministry of Finance of the Russian Federation considers the need to increase the retirement age as one of the most effective measures to save the state budget. Its head, Anton Siluanov, said that the issue requires immediate resolution.

Adoption of the Pension Fund project for 2015–2017.

In October 2015, the State Duma nevertheless achieved unity on the issue of adopting the draft Pension Fund for 2015–2017. As part of this project, the amount of pension provision was established, which by the beginning of 2017 should be 14,000 rubles.

According to analysts’ calculations, PFR revenues should amount to 7.8 trillion rubles in 2016, and in 2017 this figure should reach 8.2 trillion rubles. Cumulative part Pensions will not be formed as in 2015. The old savings will all remain in the NPF. A small increase in pensions is also provided for in the law. So in 2016, the pension will be increased by 837 rubles, and the social pension – by 900 rubles. At the same time, the amount of pension benefits for persons who do not have the required work experience will be 8,479 rubles, for all others – 12,882 rubles.

On October 3, the Verkhovna Rada adopted the government draft pension reform. The document was supposed to be voted on back in May, after which the date of consideration was postponed to September, but the voting failed the first time. On the second attempt, the majority of parliamentarians cast their votes “for” the pension reform. The authorities limited themselves to “repairing” the solidarity system, and the promised launch of the funded level was again postponed. This time for 2019.

Realist understood the main innovations of the “Groysman pension reform”.

You will have to work longer, but not everyone

The most controversy arose around the issue of raising the retirement age. The IMF insisted that Ukrainians should work until they were 63, and one version of the Memorandum that was leaked to the media suggested that this would be the case. But in the end retirement age not touched.

True, some Ukrainians will still retire later. The fact is that in Ukraine they are introducing a “flexible corridor” with several “doors”. The first, as now, is 60 years old, the second is 63 years old and the third is 65 years old. To get to the first “door” next year you need to have at least 25 years of experience. And every year the requirement will be increased by 12 months, until in 2028 Ukrainians with 35 years of experience will retire “on time.” Those who work between 25 and 35 years will be able to receive a pension at age 63. And with experience from 15 to 25 years - at 65 years old.

There is also a pleasant moment. Starting next year, you can retire even before age 60, but only if you have 40 years of experience.

The “barrier” of 25 years (it will be in effect from next year) will be overcome by the majority of 60-year-old Ukrainians. But in 10 years, only 55% of Ukrainians will retire on time. The rest will have to work until they are 63 or even 65 years old.

“Old” pensions will be recalculated in a new way, and “new” ones will be cut

The government registered the pension reform project under the title “On Amendments to Certain Legislative Acts on Increasing Pensions.” Although, in fact, not all Ukrainians will increase their payments. Moreover, everyone who reaches 60 years after the reform will be in a worse situation.

So, pensions will actually increase. Now approximately 11.7 million Ukrainians receive them. Payments will be “updated” for 5.6 million, and about 3 million more will receive an increase as part of indexation. “Modernization” - recalculation of pensions according to the current average salary. This figure is growing every year, and for those who retired 10 years ago, pensions were calculated based on the average salary of 1197.9 UAH, while the current average salary (counted as three last year) — 3764 UAH. Such a recalculation will allow Ukrainians to “get rich” in the amount of from 50 to more than 1000 UAH.

About 3 million more pensioners will receive an increase as part of indexation. Twice a year the government raises social standards, including the minimum pension. Initially, they planned to add 61 UAH to pensions, for this moment decided to index pensions by 140 UAH.

The remaining pensioners, which is about 3 million people, will receive the same amount after the reform as before it.

The formula for calculating pensions includes not only the average salary, but also the ratio of one’s own salary to the average, length of service and the coefficient for its evaluation. The latter figure after the reform will be reduced from 1.35 to 1%. This means that all future Ukrainian pensioners will receive 25% less. True, the transition to lower pensions will be made smooth. To do this, until the end of 2018, the formula for calculating pensions will take into account the average salary for not three, but two years.

For example: before the reform, a Ukrainian with 30 years of experience and a salary 1.5 times higher than the average this year could receive a pension in the amount of UAH 2,286, and if the reform had been fully in effect, this amount would have been UAH 1,693.

Will be indexed in a new way

At the moment, all Ukrainian pensioners' pensions are increased by the same amount - a certain percentage of the minimum pension. After the reform, the situation is promised to change. The amount of the increase will be divided into two components: 50% of inflation + 50% of the increase in average wages over the last three years.

Moreover, a percentage of salary growth will be included in the formula for calculating pensions. In fact, this means that all Ukrainians’ pensions will grow differently. If the Pension Fund deficit can be eliminated, then pensions will be increased by 100% of the three-year average salary growth.

It is also important to take into account that the average salary with which a single social contribution is paid is considered. The maximum amount from which the contribution is paid is 40 thousand UAH. If the salary is 100 thousand UAH, then in the Pension Fund report it will be “counted” against salaries in the amount of 40 thousand, since there is no need to pay tax on the remaining 60 thousand.

Working pensioners will get their “full” pensions back

Working pensioners are entitled to only 85% of the pension. The remaining 15% is retained in favor of the state. Already this month, according to adopted reform, this practice will be abolished. As a result, approximately 650 thousand Ukrainians (the number of pensioners officially working) will receive an increase of 17%. For example: a working Ukrainian who receives a pension of 1,445 UAH, after the reform will be able to receive 1,700 UAH.

Another important innovation is that special pensions for journalists, scientists, teachers, doctors, and officials are being cancelled. Now everyone will be calculated the amount of payments according to a single formula.

“Groysman’s reform” is only the first step towards transforming the current pension system. The document does not solve the main problems. In the budget for next year The Pension Fund deficit is envisaged at UAH 141 billion, which means that the “hole” will remain almost unchanged. And the size of pensions, even after “modernization” and indexation, will not reach 40% of usual earnings, as provided for by international conventions. The next step of the reform is scheduled for 2019 - then they plan to launch a savings level, that is, in addition to the social contribution to the Pension Fund, workers will have to put aside part of their salary into a personal account. It is the funded level, as most experts hope, that will significantly improve the well-being of Ukrainians in old age.

Pension reform in Ukraine, in addition to new requirements for retirement age and insurance coverage, led to comprehensive changes in the pension system, incl. changes in the procedure for calculating and indexing pensions. All this has led to many questions among current and future Ukrainian pensioners.

People want to know what to expect from the new pension reform. When and how much will pensions increase? What is the retirement age in Ukraine for men and women? How to retire? How much experience do you need? In order to understand how the lives and incomes of pensioners have changed, the Legal Portal looked into the innovations of the Pension Reform.

Law of Ukraine No. 2148-VIII dated October 3, 2017 “On introducing changes to current legislative acts of Ukraine to increase pensions” provides for a gradual change in the pension system over the next 10 years. In fact, due to the increase in requirements for insurance experience, Ukrainians will retire every year according to new rules.

Retirement age and insurance period

Formally, the retirement age for men and women remained at the same level - 60 years, however, the requirements for work experience have increased. Since 2018, only those Ukrainians who have worked and paid contributions for 25 years or more can retire upon reaching retirement age.

With each subsequent year, requirements for the quantity needed insurance period for pensions will increase (+ 12 months). Thus, by 2028 you will need to have 35 years of experience. Those who do not have it will be able to retire only at 63 years old. If by the age of 65 a person has less than 15 years of insurance coverage, he will not receive a pension. Instead, social assistance will be provided, the amount of which is determined based on the income level of the pensioner’s family.

In addition, the Pension Reform provides for the provision of temporary state pensions to Ukrainian citizens between 01/01/2018 and 12/31/2020. social assistance. It is prescribed to non-working persons who have reached the established retirement age, have at least 15 years of insurance experience, but have not received the right to pension payments. Cash assistance will be issued for the period until the acquisition of the right to an old-age pension for persons who have lost their ability to work.

At what age can women retire?

The new pension reform in Ukraine turned out to be more friendly to women, since it retained the opportunity for them to retire until they reach 60 years of age. The retirement age for the fair half of the population will increase gradually and will reach sixty only in 2021.

So, for example, in 2018, if they had the appropriate insurance experience (see table above), women who turned 58.5 years old could retire. Accordingly, women can retire after reaching the following age:

• in 2019 - 59 years old (born from 04/01/1960 to 09/30/1960)
• in 2020 - 59.5 years (born from 10/01/1960 to 03/31/961)
• in 2021 - 60 years old (born from 04/01/1961 to 12/31/1961)

What is included in the length of service for calculating a pension in Ukraine?

As you know, the new Pension reform has made serious adjustments to accounting length of service to apply for a pension. In this regard, many Ukrainians have a completely logical question: “Is study at the institute, military service, maternity leave and employment center included in the insurance period?”

In accordance with the amendments made by the Law of Ukraine “On Increasing Pensions”, the insurance period to determine the right to a pension, in addition to entries in work book, the following periods are included:

• passing military service(including in Soviet army) - until 12/31/2017 inclusive
• stay on leave due to pregnancy and childbirth (maternity leave) - from 01/01/2004 to 06/30/2013 inclusive
• full-time studies at higher educational institutions (budget), as well as postgraduate and doctoral studies - from 01/01/2004 to 12/31/2017 inclusive
• being on parental leave to care for a child up to 6 years old - from 01/01/2004 until the introduction of payment of insurance premiums (UST) for women on parental leave until they reach the age of three

Besides, in pension experience The period of conducting business activities on a simplified taxation system or using a fixed tax is counted:

• from January 1, 1998 to June 30, 2000 inclusive - confirmed by a certificate of registration of the entrepreneur
• from July 1, 2000 to December 31, 2017 inclusive - upon payment of the unified social contribution (regardless of the size of the single insurance premium)

What to do if you don’t have enough insurance experience?

New pension legislation provides two options for solving this problem. The first is to purchase additional insurance experience. At the same time, purchasing 1 year of experience will cost 16,896 hryvnia. The second option is to continue working, earning the missing experience, and retire later.

Recalculation of pensions in Ukraine

The increase in pensions in Ukraine occurred retroactively. Updating previously assigned pensions, incl. and for working pensioners, carried out according to a single formula, regardless of the year in which the pensions were issued. The basis is the average salary indicator for all pensioners for the last 3 years (2014-2016) in the amount of 3764.4 hryvnia.

After the recalculation, about 1.3 million pensioners received an increase in their pension in the amount of 200 UAH/month, and the pension amount increased by 200 to 500 UAH for another 1.2 million Ukrainians. The pension payments of almost 2 million people were replenished with an additional amount in the range of 500-1000 hryvnia. For approximately 1.1 million more citizens, pensions increased by more than 1,000 hryvnia.

Also, from October 1, the indicator was revised living wage for disabled citizens, to which the minimum pension in Ukraine is tied. Now the amount of minimum pension payments is 1,452 hryvnia. For people who do not have the required length of service to qualify for a pension, the amount social benefits increased to 1373 UAH.

The minimum pension for miners increased by 420 hryvnia and is now 4356 hryvnia. The supplement to the minimum amount of pension payments for Chernobyl victims is: for the 1st category - 399 UAH, the second - 357 UAH. and 315 hryvnia for the third category of victims of the Chernobyl accident.

According to the PFU, the minimum pension for combatants is set at 2 thousand 395 hryvnia, which is 231 UAH. more than the previous level. Payments have also increased for war invalids: for group 1 - 4138 UAH, for group 2 - 3702 UAH, for group 3 - 3267 UAH.

Recalculation of pensions is carried out automatically without additional treatment. Payment of modernized (increased) pensions in Ukraine began in October 2017.

New formula for calculating pensions in Ukraine

Before the adoption of the pension reform, pensions were assigned according to dozens of different laws using special calculations for each type of pension provision. As a result of this, with the same length of service and level of earnings, pension payments for certain categories of citizens differed significantly from others.

In 2019, the calculation of pensions in Ukraine under the new pension reform is carried out according to the same formula for all pensioners (regardless of status and place of work):

Pension amount = Sz × Ikz × Ks, Where

• NW— the average salary in Ukraine for 3 years before applying for a pension. In 2017, the average salary is 3 thousand 764 hryvnia 40 kopecks
• X— individual salary coefficient, information about which can be obtained from the Pension Fund. This indicator is the ratio of the amount of income received in relation to the average salary from which contributions were paid
• KS— insurance experience coefficient, which is determined as a multiplier of the duration of months of work experience by the value of the assessment of one year of insurance experience (until December 31, 2017 - 1.35, from January 1, 2018 - 1)

Who won't have their pension increased?

As part of the pension reform, modernization affected the pensions of all Ukrainians, because the recalculation is in no way tied to the profession or position of the pensioner and the type of his pension. Thus, an increase in payments awaits everyone: those who receive an old-age pension, and in connection with disability or loss of a breadwinner, for long service, and even those who have retired under special laws.

The recalculation of pensions for internally displaced persons was carried out on the same conditions as for other Ukrainian pensioners. The Pension Fund has all the necessary information to recalculate payments to IDPs. But for residents of the occupied territories, modernization of pensions is not provided. Moreover, if it is determined that displaced persons have returned to uncontrolled territory for more than 60 days, the payment of pensions to them will be suspended.

Pension indexation

Indexation of pensions in Ukraine will occur annually, starting in 2019. The new indexation mechanism provides for a revision of the pension amount by at least 50% of the increase in average salary (income) over 3 years and by 50% of the consumer price index. From 2021, it is planned to automatically recalculate pension payments without additional government decisions.

Special and early pensions

From January 1, 2018, in Ukraine, as part of the reform, special pensions for civil servants, scientists, deputies, prosecutors, judges, diplomatic service workers, local government officials and other categories have been abolished. All of them are switching to a general pension calculation system, but at any time they can contact the Pension Fund authorities and return to the special pension. True, the amount of payments will not be recalculated and indexed.

In addition to special pensions, the system of assigning preferential and early pensions was reformed and partially abolished. In particular, for doctors, teachers and workers social protection The right to receive a pension for long service has been abolished. However, for some categories of Ukrainians the opportunity to retire early has been preserved. Namely:

• artists (if they have 20-35 years of creative experience)
• persons who worked in heavy and harmful conditions according to list No. 1 and No. 2
• tractor drivers, milkmaids, pig farmers, textile workers
• women who gave birth and raised 5 or more children or a disabled child (at 50 years old with 15 years of experience)
• midgets and disproportionate dwarfs (men aged 45 years and 20 years of experience, women 40 years old with 15 years of insurance experience)
• drivers of urban passenger transport (at 55 years old and with insurance experience for men - 30 years, for women - 25 years)
• fathers who raised five or more children or a child with a disability (upon reaching 55 years of age and having at least 20 years of insurance experience)
• disabled people of the 1st group in terms of vision (blind) and disabled people from childhood of the 1st group (men who have reached 50 years of age + 15 years of experience, women of 40 years of age and with 10 years of experience)
• military - participants in combat operations and members of their families (after men reach 55 years of age, women - 50, and if they have an insurance period of at least 25 years for men and at least 20 years for women)

Pensions for military and working pensioners

Recalculation of cash payments to military personnel is carried out according to a separate law. Modernization of military pensions began in January 2018. The increase in the amount of payments will be individual and directly depends on length of service and financial support; on average, military pensions will increase by 62%.

For working pensioners, the restriction on pension payments is lifted, and now the money can be received in full. Let us remind you that previously pensions whose size exceeds 10 subsistence minimums were taxed at a rate of 18% and a military tax of 1.5%.

• • 1.In what areas should we expect innovation?
  • 2.Features of the storage system
  • 3.Creation of an additional reserve fund
  • 4.Increasing the retirement age
  • 5. Calculation of pensions for civil servants

For several years now, the question of the need to reform the pension system in Russia has been brewing; today the Ministry of Finance, together with the Ministry of Economic Development, have prepared a number of amendments and will present a finished bill by the end of the year. Among the most controversial issues is the increase in the retirement age; we will consider what other changes may occur in more detail.

In what areas should we expect innovation?

Since the full package of changes is in the process of preparation, it is difficult to say with certainty which areas the changes will affect, we only know that it is planned to consider issues about:

• raising the retirement age bar;
• creating an additional reserve fund;
• the procedure for calculating pensions for civil servants;
• reforming the pension savings system.

What changes will be paramount and what is planned to be done in the next few years is not yet fully known, but by the end of the year the government has promised to present a full action plan for everyone to see.

Features of the storage system

The possibility of accumulating one’s own pension, which only recently seemed illusory, is getting closer; by the end of 2017, every Russian will be able to familiarize himself with the system of accumulation of funds and the main provisions of this law. The Ministry of Finance, with the support of the Central Bank, is at this stage actively working to study the possibilities of circulation of funds and their savings; as soon as all the nuances are resolved, the law will immediately come into force.

As reported on the 1Fin.Biz website, the main changes in the accumulation mechanism will concern additional opportunities for working citizens to influence the level of their future pension by accumulating funds, the size of the pension will increase annually. Those who ignore the initiative will have to be content with standard pension payments established by the state.

Also, according to the head of the Ministry of Finance, Anton Siluanov, the savings mechanism will be:

• Completely voluntary.
• It will become more accessible.
• Reliably protected by the state.
• The right to inherit accumulated funds will appear.
• The accumulated funds can be withdrawn (subject to certain restrictions, if necessary).

At the moment, the funded mechanism in Russia is suspended; as soon as new provisions are adopted, the law will come into force again.

Creation of an additional reserve fund

The decree on reforming the savings system that guarantees payments to insured citizens was signed by the president a long time ago, and early this year specialists are working on creating a two-tier system. This system will be based on guaranteed mandatory pension payments, and an additional state reserve fund will be created.

Judging by how global changes are coming to the pension system, changes will also affect a number of other provisions relating to pension payments.

Raising the retirement age

There is no doubt that the retirement threshold will be increased, but it is not yet clear how the transition will be carried out. Opponents and supporters of this decision are still at the stage of discussing an increase in the retirement age, some propose to gradually increase the age threshold, and some think so. That there is no point in delaying the decision.

One way or another, other details of the upcoming reform are kept secret for now.

Calculation of pensions for civil servants

Innovations are also planned in this area; now every official will receive an additional bonus for overtime over the specified retirement age. Civil servants will be able to occupy their positions longer, and at the same time receive additional benefits from processing.

What other surprises the pension reform is preparing will become clear at the end of 2017.

In this article I want to give an overview of the important changes that entail pension reform in Ukraine 2017, the law on which has already been adopted, signed by the president and will come into force in 2018. After reading this article, you will find out what will change in the country’s pension system, what the retirement age will be, how the pension will be calculated and many others. important points. Well, whether it’s good or bad for you specifically, you can draw your own conclusions. So, let's begin.

The law on pension reform in Ukraine was adopted by the Verkhovna Rada on October 3, 2017 and signed by the President on October 7. This is Law No. 6614 of June 22, 2017 “On Amendments to Certain Legislative Acts of Ukraine Regarding the Increase of Pensions,” which partially came into force retroactively - from October 1, 2017 (from this date pensions will be increased), and will come into full force effective from January 1, 2018.

Pension reform in Ukraine is one of the demands of the country’s largest creditor. Next, I bring to your attention an overview of the main innovations of the adopted pension reform.

Increase in pensions in Ukraine from October 1, 2017.

From October 1, 2017, pensions will be increased in Ukraine for the majority of current pensioners; the law has coined a special term for this – “modernization”. Namely:

• The minimum pension for citizens who do not have enough insurance coverage (what this is - more on that later) will increase from 949 to 1373 hryvnia(by 424 UAH or 45%);
• The minimum pension for citizens who have sufficient insurance experience will increase from 1312 to 1452 hryvnia(by 140 UAH or 11%);
• The average increase in pensions of Ukrainian citizens from October 1, 2017 will be about 700 hryvnia;
• At the same time, the pensions of 1.3 million pensioners will increase by approximately 200 hryvnia, more than 1.2 million pensioners will receive by 200-500 hryvnia, 2 million pensioners will receive by 500-1000 hryvnia, and 1.1 million will receive more than 1000 hryvnia. million pensioners;
• In total, the pensions of approximately 9 million pensioners will be recalculated.

Pensions will be recalculated automatically; they will be calculated and paid in the new amount, as the government promises, within 2-3 weeks. At the same time, those pensioners who have already received a pension payment for October according to the old calculation will be recalculated and additionally paid.

In general, as a rule, than more years ago the person retired, the greater the increase in pension he will now receive after the recalculation.

What will the pension be like after the pension reform in Ukraine?

The main criteria on which will depend new size There are two pensions: the length of service and the salary received. Before the pension reform of 2017, there was a third indicator taken into account - the average salary in Ukraine, but now they decided to abandon its use, and when recalculating pensions, the same average salary for all will be used - 3674.40 UAH (based on the calculation for the last 3 years: 2014- 2016).

Also, the recalculation took into account the cost of living established as of December 2017, equal to 1,452 UAH - this is exactly the amount of the minimum pension that citizens who have completed their required insurance period will receive. Previously, the minimum pension was below the subsistence level, which was unfair.

Also, a situation previously arose in which people who had worked the same length of time in the same industry, but retired in different years, received significantly different pensions, now the pension reform eliminates this option.

The pension reform cancels the 15% reduction in pensions for working pensioners that has been practiced until now; now working people will receive the same pension as non-working people.

At the same time, with their wages All due deductions in the form of taxes and fees will be made, including to the Pension Fund.

The pension reduction for women who exercised the right to early retirement at age 55 is also cancelled. When their age exceeds the retirement age by the number of months of early retirement, they will be paid 100% of the amount.

But pensions for residents of mountainous areas will be increased by 20%.

Formula for calculating pensions in Ukraine.

The pension reform in Ukraine in 2017 establishes the following formula for calculating pensions.

• NW– The size of the average salary (at the moment it is the same for everyone, and is 3674.40 UAH, it will change further);
• IKZ – Individual coefficient salaries (defined as the ratio of the salary received to the average salary);
• KS– Insurance experience coefficient (defined as the number of years of insurance experience multiplied by the size of the assessment of one year of insurance experience).

Previously, the insurance length coefficient was taken to be 1.35, but now it will be equal to 1, but pensions will now be indexed annually.

Indexation of pensions in Ukraine.

The pension reform in Ukraine introduces the norm of automatic annual indexation of pensions, which will begin in 2019 in order to protect pensioners from.

The law establishes the following norm: the amount of indexation will be determined by the capabilities of the Pension Fund, but it cannot be less than 50% of the increase in average wages over 3 years and less than 50% of the increase in the consumer price index (this is the inflation rate).

Retirement age in Ukraine. Insurance experience.

The 2017 reform does not directly provide for an increase in the retirement age, but it does provide for increased requirements for insurance coverage.

The insurance period is the time a citizen worked, during which deductions were made from his income to the pension fund in an amount not lower than the minimum insurance contribution. Insurance experience is not the same as work experience, and most often it is less than work experience.

In addition to direct work activity, the insurance period includes:

• Period of military service;
• Period of parental leave up to 3 years;
• The period of undergoing professional training, retraining, and advanced training without work, without maintaining a salary and with the payment of a stipend;
• The period of receiving benefits for the care of a disabled child, a disabled person of group 1 or an elderly person who needs care upon conclusion of a medical institution, or who has reached 80 years of age;
• The period of payment of voluntary insurance contributions to the Pension Fund on the basis of a voluntary participation agreement.

Currently, the required minimum insurance period to receive a pension is 15 years. From the moment the pension reform comes into force, it will begin to gradually increase, and pensioners with different lengths of service will retire at at different ages: 60, 63 or 65 years.

The younger a person is today, the longer the insurance period he will need to retire.

Here are some provisions of the law:

• From 2018, to retire at 60 years of age, at least 25 years of insurance experience will be required; those with 15 to 25 years of insurance experience will be able to receive a pension only from the age of 63, and less than 15 years from the age of 65;
• From 2028, the minimum insurance period for retirement will be 35 years;
• From 2028, citizens who have accumulated 40 years of insurance experience will have the right to retire at any age (even less than 60 years).

At the same time, the 2017 pension reform introduces the opportunity to purchase additional insurance experience, that is, to pay a certain amount of insurance premiums one-time in order to retire earlier.

1 year of insurance experience currently costs about 16.9 thousand hryvnia, 5 years - 84.48 thousand hryvnia. It is impossible to purchase more than 5 years of insurance experience.

How profitable such a “deal” is is necessary to calculate in each case individually.

Early retirement.

The pension reform in Ukraine in 2017 leaves the right to early retirement for certain categories of citizens:

• Military personnel who participated in hostilities (retirement at 55 years);
• Mothers raising 5 or more children or disabled since childhood (retirement at 50);
• Artists with 20-35 years of work experience;
• Journalists who were injured, concussed, or maimed in “hot spots” while engaged in professional activities;
• Liquidators of the Chernobyl accident;
• Lilliputians and dwarfs.

Temporary state social assistance.

In 2018-2020, unemployed persons who have reached retirement age, have at least 15 years of insurance experience, but have not received the right to receive a pension, will receive temporary state social assistance in the amount of the subsistence minimum for persons who have lost their ability to work.

The pension reform abolishes special pensions.

The 2017 pension reform in Ukraine abolishes most of the special (increased) pensions. Now judges, deputies, civil servants, prosecutors, diplomats, and scientists will not receive them.

The exception here is military personnel and employees of law enforcement agencies - for them, special pensions will be preserved, but they will also be “modernized.” How exactly this will happen is still unknown; additional legislative acts should be adopted in this regard:

• Before November 1, 2017, a bill on modernizing pensions for military personnel must be prepared;
• After the adoption of this law, within six months, bills should be prepared on the introduction of a professional pension system for certain categories of professions and on the procedure for receiving pensions that citizens could not receive while being in territories temporarily not controlled by Ukraine.

Accumulative pension system.

The pension reform in Ukraine provides for the introduction of a second level of the pension system - a funded pension - from 2019, which will coexist simultaneously with the solidarity system. According to this norm, each citizen will make contributions to a special personal savings account, from which he will subsequently receive additional pension payments. Responsibility for the safety of funds in these accounts rests with the state.

How to find out your insurance period and pension amount?

To find out your insurance experience, pension amount and other related personal data, you can access your personal account on the website of the Pension Fund of Ukraine. To do this, you will need to write a written application to the Pension Fund, after processing which you will be given a special code to create a personal account.

In your PFU personal account you will be able to see your insurance record and all your contributions to the fund starting from 2000.

Pension reform in Ukraine – 2017: pros and cons.

In conclusion, I would like to highlight the main pros and cons that the pension reform brings.

Pension reform in Ukraine, advantages:

1. Carrying out the reform, as planned, will make it possible to gradually reduce and ultimately eliminate the budget deficit pension fund, which is now very large (141.5 billion UAH = about 5 billion dollars in 2017), and it has to be covered from the state budget.
2. The gradual introduction of a funded pension system along with the solidarity system is already a well-proven and fairer world practice (than more people contributed - the more he will receive).
3. Simplification of the method of calculation and accrual of pensions. Before the pension reform, this was all done on the basis of more than 25 legislative acts and more complex formulas, now there is 1 law and simple, understandable calculation formulas.
4. The reduction in pensions for working pensioners has been abolished.
5. There is an opportunity to buy insurance experience - people have a choice.

Pension reform in Ukraine, disadvantages:

1. In fact, the retirement age will gradually increase, only in an implicit, hidden way.
2. Some periods that were previously taken into account in the insurance period will now not be taken into account (for example, in many cases, studying at a university, being in maternity leave etc.).
3. The length of service coefficient reduced from 1.35 to 1 will actually reduce the amount of the calculated pension by a third.
4. Categories of citizens who previously received special pensions will no longer receive them, for example, civil servants.
5. The introduced principles of the pension system, based on the experience of developed countries, may not be well adapted to the conditions of Ukraine. For example, contributions to funded pension can be greatly depreciated by inflation and devaluation.

These are the innovations promised by the pension reform in Ukraine in 2017. Whether this is good or bad – judge for yourself.

In my opinion, in principle, count on state pension hopeless: in order to meet old age with dignity, you need to independently create alternative sources of passive income. I described the most accessible options for such sources in the article. And in other articles on the site there is a lot of information on this matter. Therefore, I recommend not worrying too much about the changes that the pension reform brings, but switching your attention to what depends directly on you, what you yourself are able to influence.

Thank you for your attention, I hope that you now have a clear picture of what the pension reform in Ukraine in 2017 represents. See you again on the pages of the site!