The bill on raising the retirement age in Russia may be considered by the State Duma in the first reading as early as July. The law is expected to come into force on January 1, 2021. Explaining the need to implement the unpopular measure, the authorities refer to the increasing life expectancy in Russia and the experience of other countries. What specific methodology the authors of the document used in their calculations remains unclear. Experts believe that many important socio-economic criteria have been ignored.
Main parameters of the reform and explanations from the authorities
In accordance with the bill, the retirement age for men will be increased from the current 60 years to 65 years by 2028, for women - from 55 years to 63 years by 2034. The increase is planned to be carried out in stages. At the same time, the reform will affect men born in 1959 and younger and women born in 1964 and younger. The explanatory note notes that the current retirement age was fixed in 1928, when life expectancy in the RSFSR was 43 years. “To date, the life expectancy of Russians as a whole has increased significantly,” the authors of the note write.
This argument is the main one for the Ministry of Labor, the agency appointed responsible for implementing the reform. As the ministry's press service told DW, “if in 1970 there were 3.7 people of working age per pensioner, by 2021 this figure will be approximately 2 people. The burden on workers will continue to increase - the number of working population is decreasing annually by 0.4 million people, the number of people retiring annually is 1.5-1.6 million people.”
Life expectancy and retirement age: playing ahead?
Statistics on current and life expectancy form the basis of the reform. Rosstat provides three forecast options - low, medium and high - until 2035. According to the low forecast for the current year, the average life expectancy for men will be 67.5 years (68.6 with a high forecast), for women - 77.4 years (78.3 with a high forecast). Particular indignation in society (protests against the reform took place on July 1 throughout Russia) is caused by the fact that the average life expectancy of a man is only 2.5 years longer than the new retirement age.
The authors of the reform are guided by those indicators that are convenient for them
However, as the authors of the reform note, one should focus not on current indicators, but on the outlook for the next 17 years. Here the pessimistic and optimistic forecasts of Rosstat seriously diverge. According to the first, the average life expectancy for men will be 70.3 years, for women - 79.3 years. According to the “high” forecast, men will live to an average of 78.6 years, women - to 85.7.
Probably based on this forecast, Russian Minister of Labor and Social Protection Maxim Topilin said in an interview with Izvestia that “we need to gradually increase the retirement age, because by 2030 the increase in life expectancy and life expectancy after reaching retirement age will increase.”
Long life expectancy does not guarantee ability to work
Experts interviewed by DW believe that linking the retirement age to the level of average life expectancy is incorrect. Thus, Doctor of Economic Sciences Sergei Smirnov draws attention to the fact that even Vladimir Putin’s May decree of 2021 states that the duration of active activity and healthy existence in Russia should be 67 years.
The head of the laboratory of problems of level and quality of life at the Institute of Socio-Economic Problems of Population of the Russian Academy of Sciences, Vyacheslav Bobkov, also believes that the reform should be based not on the average life expectancy, but on the degree of disability. "I haven't seen any studies anywhere that evaluate this particular parameter," he told DW.
Meanwhile, according to the expert, this is the main indicator for determining an acceptable retirement age, since if the degree of disability is high, if people get sick, then this is fraught with a high level of unemployment and the need to pay sick leave. “In addition, in the end, people will die faster, because it is one thing to be sick in retirement, and another thing to work at the same time,” he notes.
Labor market readiness is in question
Speaking about the readiness of the labor market to accept a new number of workers in high age categories, the authorities claim that they will be able to control the situation.
The state promises to help pensioners, but where are the guarantees?
As the press service of the Ministry of Labor told DW, “with an increase in the retirement age, the state’s efforts will be aimed at eliminating all manifestations of restrictions when hiring older workers, which people have been demanding for a long time. The state supervisory authority, Rostrud, will be tasked with especially monitoring this.” “Strengthening control is not an option,” says Doctor of Economic Sciences Sergei Smirnov. — Employers are against providing job guarantees to people in high age groups. And there are no working control mechanisms here.”
Now flexible forms of employment are developing, perhaps people of pre-retirement age will be offered to use them, but it is not a fact that they are ready for this, says RAS expert Vyacheslav Bobkov. This, in particular, is remote employment, which involves working on a computer.
Context
German experts believe that the World Cup will interfere with protests in Russia
Raising the retirement age is a winning topic for the opposition, but mass protests may be hindered by the successful performance of the Russian national team at the World Cup, German experts say.
(06/19/2018) “Many of those who will be forced to work longer (and this, according to experts, is about 14 million people - Ed.), are not adapted to this,” he says. In the traditional segment, competition with other age groups will inevitably arise. “All this should have been carefully prepared. But was she? - the expert asks a question. In his opinion, it would be necessary to promise preferences to employers, for example, for tax purposes.
Reform cannot be carried out without a tangible increase in income levels
As Russian Minister of Labor and Social Protection Maxim Topilin stated, “the main goal of the government’s proposals is to increase the size of the pensions of both current pensioners and future ones.” However, according to experts, this is deceit. “In essence, the decisions taken are a pension default, because it is obvious: the retirement age is rising due to the fact that the Pension Fund and the federal budget cannot cope with fulfilling their obligations,” says Sergei Smirnov. According to him, the increase of 1 thousand rubles a year promised to pensioners looks rather “ridiculous”.
In addition, people who expected to start receiving a pension earlier will lose this source of income (today the average pension is about 14 thousand rubles). “If wages had risen by these 14 thousand, then we could seriously talk about raising the retirement age,” the economist believes. The beginning of the reform is impossible without increasing wages, agrees Vyacheslav Bobkov. “Today they are actively promoting that pensions will increase. But what about those who remain to work?
The answer to this question was given to DW by the press service of the Ministry of Labor: “Income from work is always higher than pension.” “This is some kind of mantra, an argument that does not stand up to criticism,” retorts Bobkov. “It’s one thing I’ll receive two sources of income, another thing I’ll receive one.” “So far I see that the reform has not been prepared,” he sums up. However, the expert admits that under the influence of protests, which, according to his forecast, will intensify after the end of the 2018 World Cup, the reform will undergo changes.
See also:
Protests against pension reform in Russia
Raising the retirement age in 2021
On July 19, 2021, the State Duma adopted in the first reading a bill to increase the retirement age from January 1, 2019 for men up to 65 years of age and for women up to 63 years of age. According to the bill, the retirement age will be raised in stages in one-year increments, every other year. The transition period will take 10 years for men and 16 years for women.
The next meeting of the State Duma is scheduled for September 24. Before this date, parliamentarians must make all amendments to the law. It is expected that the bill on the new pension reform to raise the retirement age will be adopted in the fall of 2021.
TASS report: the new pension age reform is considered launched on June 16 , when the press service of the Cabinet of Ministers provided information about the submission of a bill to the State Duma.
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The new law on retirement age will ultimately allow us to establish a clear relationship between the average pension payment and the average salary.
All news feeds indicate an increase in the retirement age from January 1, 2019 . But they forget about the fact that today there is not a single economic indicator that would be tied to the size of the pension. It is difficult to realistically estimate the incomes of pensioners if they are not related to the minimum wage or average wage—not a single indicator that is responsible for the working-age population.
An important element of the reform will be the ratification of the 102nd Convention on Minimum Standards of Social Security. It will allow us to bring pension provision to the international level.
The latest news of the new pension system is presented by RIA Novosti with reference to the episode of the Russia 1 program - “Sunday evening with Vladimir Solovyov.” In addition to changing the age of pensioners, the pension system will undergo modifications to the mechanism. Retirement points are expected . However, this does not mean that all savings of citizens will be lost. Everything that will be in the personal accounts of citizens at the time the new law is introduced will remain unchanged. Deputy Prime Minister Tatyana Golikova has not yet announced the details of the new mechanism.
on the issue of bringing the average pension to 40% of average earnings . It is inappropriate to talk about the average salary in the country. This indicator should be tied to the individual's specific lost earnings. The principle of individual calculation must be preserved, first of all, for the sake of social and economic justice.
Once again the essential point was emphasized - the reform will affect only future pensioners. The law will not affect military personnel and working pensioners. They have already earned their right to a pension.
The main problem of raising the retirement age, and all experts agree, is unspoken discrimination in the labor market against older people. Rostrud received an order from the Government to develop special measures that would make it possible to influence unscrupulous employers who are trying to lay off future retirees or refuse to hire them.
The essence of the reform of raising the retirement age
On June 14, 2021, a regular meeting was held in the Russian Government, at which two of the most painful issues were discussed: an increase in the tax burden and a change in the retirement age.
In his opening speech, Prime Minister Dmitry Medvedev said that the needs for reform “are long overdue, they are necessary.” He believes that without this, Russia will not be able to “move forward either in improving people’s living standards, or in the social sphere, or in economic development.”
Before the issue of raising the age of future pensioners received a legislative frame, it was preceded by a long history of numerous attempts to reform the pension system. The issue began to be raised most actively in the current year 2018.
In February, the Government was presented with several scenarios for pension reform, including from a group of RANEPA experts. They proposed the most financially and socially balanced schedule for raising the retirement age: up to 60 and 63 years, respectively, for women and men. All changes occur gradually over 12 years.
In April, Dmitry Medvedev announced his readiness to consider the issue subject to the necessary expert assessments and a detailed analysis of the consequences of the decisions made.
In May, Vladimir Putin announced that all measures should be taken to significantly increase pension payments and increase the standard of living of all segments of the population.
As a result, the retirement age in Russia will begin to rise in 2019 . Changes will occur over 10 years until by 2028 the bar reaches: 65 years for men and 60 years for women.
The reform is happening smoothly, raising the retirement age by six months. Already in 2020, people born in the next year will be able to retire: 1964 women, 1959 men. At this point they will be 56 and 61 years old.
Table of increasing the retirement age according to the new pension reform
As the Prime Minister noted, the reform has a transition period when the bar will gradually increase. For each 12-month increment, the age increases by six months. Transitional stages of increase will allow the population to adapt, and the economy will create conditions for expanding jobs for older people.
Retirement age increase table
| Retirement period | Men | Women | ||
| Date of Birth | Age | Date of Birth | Age | |
| 2019 | 1958-1959 | 60,5 | 1963-1964 | 55,5 |
| 2020 | 1959 | 61 | 1964 | 56 |
| 2021 | 1959-1960 | 61,5 | 1964-1965 | 56,5 |
| 2022 | 1960 | 62 | 1965 | 57 |
| 2023 | 1960-1961 | 62,5 | 1965-1966 | 57,5 |
| 2024 | 1961 | 63 | 1966 | 58 |
| 2025 | 1961-1962 | 63,5 | 1966-1967 | 58,5 |
| 2026 | 1962 | 64 | 1967 | 59 |
| 2027 | 1962-1963 | 64,5 | 1967-1968 | 59,5 |
| 2028 | 1963 | 65 | 1968 | 60 |
Starting in 2028 , men born in 1963 will begin to retire at age 65 , and women born in 1968 will begin retiring at age 60, starting 2028 . There is also a rule that the reform will not affect men born in 1958 and women born in 1963.
Preferential categories of citizens upon retirement according to the new formula
When creating the bill on the new retirement age , Dmitry Medvedev promised that existing benefits for early retirement would be maintained for the following persons:
- workers of harmful and dangerous production included in both lists;
- women who have given birth to 5 or more children;
- disabled people of group I (vision);
- persons who have become disabled due to military trauma;
- parent or guardian of a disabled person since childhood;
- citizens exposed to radiation contamination as a result of the accident at the Chernobyl nuclear power plant.
Currently, the preferential length of service for some professions has already been increased and ranges from 15 to 30 years. Therefore, innovations will no longer affect them. This means that teachers, medical workers, civil servants and people in creative professions will be able to leave early when they reach the level of special experience that is established in their industry. But the general age for going on vacation will be calculated according to the new rules. A situation arises when an employee accumulates 20 years of special service, but his age has not reached the new level, then the right to early retirement is frozen. Early pension will be assigned in the period 2019-2034 , taking into account the increase in the general age.
The benefit will remain for persons living or working in the Far North or in areas equivalent to it. However, their retirement age will also be proportionally raised by 5 and 8 years.
Pension calculation table for the new reform
| Retirement | Age | |
| Men | Women | |
| 2019 | 55,5 | 50,5 |
| 2020 | 56 | 51 |
| 2021 | 56,5 | 51,5 |
| 2022 | 57 | 52 |
| 2023 | 57,5 | 52,5 |
| 2024 | 58 | 53 |
| 2025 | 58,5 | 53,5 |
| 2026 | 59 | 54 |
| 2027 | 59,5 | 54,5 |
| 2028 | 60 | 55 |
| 2029 | 55,5 | |
| 2030 | 56 | |
| 2031 | 56,5 | |
| 2032 | 57 | |
| 2033 | 57,5 | |
| 2034 | 58 | |
The Government refers to the following measure as a preferential condition or compensation. Citizens who have developed a significant work experience of 40 years for women and 45 years for men receive the right to retire 2 years earlier than for persons of their year of birth.
at the Government meeting on June 14 , but a number of ministries also proposed raising the age of social pension recipients who do not have sufficient work experience. As part of the introduced reform, it should be expected that this will also happen gradually until the age reaches:
- in women 68 years old instead of 60;
- men are 70 years old instead of 65.
The main reasons for raising the retirement age
Pension reforms have several main reasons. And they all flow from one another. Let's start with statistics:
- Demographic changes in Russia's population have led to the aging of the nation. This was facilitated by a doubling of life expectancy compared to data almost 90 years ago. Forecasts for the future period indicate that the duration will further increase by an average of 5 years . are expected to live to 72 years 2028 and women to 2034 .
- The demographic crisis has led to a serious imbalance in the Pension Fund budget. The ratio of working citizens to pensioners has changed significantly, not for the better. Already, three pensioners are “provided for” by five workers. And this is not enough for the state, represented by the Pension Fund, to perform social functions.
- The growing budget deficit of the Pension Fund does not provide opportunities to increase the size of social benefits. In order to provide pensioners with a decent income, it is necessary to change the structure of the fund's expenses. Then the annual indexation will not be a few rubles, but will reach several thousand.
- Higher social benefits will improve the well-being of the country's elderly population and improve their quality of life. This is possible with real income growth. Which, within the framework of the officially recorded price increase index, has not yet occurred.
- The main reason is hidden in the execution of the “May decrees” of the president. When the task was voiced - to increase the level of pensions and find opportunities to index state payments to working pensioners. And although a little later on the “straight line” it was proposed to “treat the issue with caution,” raising the retirement age has already become a necessity.
New rules for pension indexation after increasing the retirement age
During Dmitry Medved’s speech, there were no clear provisions on how further indexation of pension payments would take place. However, in the analytical note that accompanied the proposed program, there is a figure - 1000 rubles. This is the increase that pensioners will be able to receive next year.
Let us recall that in 2016 the indexation of pensions gave an average increase of 399 rubles , in 2021 – 524 rubles , in 2021 – 324 rubles.
If pensions are increased at the pace announced by the Government, then by the end of the transition period, in 2034 , the average pension in the country should be 26 thousand rubles instead of 14 thousand.
As Deputy Prime Minister Tatyana Golikova comments, the reform will not provide the expected savings in the first years. But due to the cumulative effect, savings due to a decrease in the number of pensioners, the system will receive enough funds to provide pensioners with a decent salary 2034
An example of calculating a pension for a man born in 1959
Pribylov A.K., a man born in 1959, before the reform he could retire in 2021 at 60 years old . By 2019, his IPC is 244.68.
But he needs to work out the new formula for another 1 year. Therefore, he will receive the right to a pension in 2020 at the age of 61. Alexander has both a funded and insurance part of his pension. A year of deferment allows him to earn an additional 6.25 points . As a result, the IPC will be 250.93 points .
Let's calculate the approximate size of the pension based on the cost of the point and fixed payment for 2021:
4982,90 + 250,93*81,49 = 25431.19 rubles.
An example of calculating a pension for a woman born in 1964
Komarina T.V., woman born in 1964 , has 3 children. When can she retire and what will be the amount of payment if her IPC is 194 points. By the time she retires in 2020, Tatyana must meet the following conditions:
— have a minimum insurance experience of 15 years;
— have at least 30 pension points.
Her IPC is more than 30. All that remains is to check her insurance record. The insurance period includes time spent caring for children up to 1.5 years, but not more than 6 years. This means that Tatyana receives 4.5 years of insurance experience for three children. She will only have to prove that she has at least 10.5 years of insurance experience, and then she can count on a pension in the amount of:
4982.90 + 194*81.49 = 20791.96 rubles according to 2018 data.
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