A decision on the gradual increase of the pension age adopted

Choosing the easy option

A decision on the gradual increase of the pension age adopted

The issue has now apparently been resolved and in the future we will all have to go over the working limit of 60 years for men and 55 years for women. From now on, Belarusian women will have to work until they are 58 years old and men until they are 63. The pension age won’t be raised immediately but will be gradually increased from 2017 to 2022, in six monthly increments.

The discussion of whether to raise it or not has been protracted and the Government proposed three scenarios. The first was to raise the pension age for men and women by five years. The second was to raise the pension age by three years for men and by five years for women. The third variant was to add three years to both. The President approved the last. “Over the next few years we’ll be able to quietly accept these three extra years,” explained Mr. Lukashenko. “It’s important for me as a father that we don’t pass on our burdens and problems to our children. We should manage them ourselves.”

Which problems does he refer to? The population is growing older; as a result, the number of those working decreases while the number of those whom we need to feed increases. How can we feed them if less money arrives in the Social Protection Fund from which pensions and allowances are paid? The ageing of the population is a universal tendency and scientists cite the following figures: every second, two people celebrate their 60th birthday. In Belarus, pensions now account for 27 percent of the budget while this will rise to 29 percent by 2020.

“Our pension fund doesn’t grow itself and we have to finance it from the budget. We take away money from doctors, teachers and the military. We can’t develop state programmes at the expense of supporting the elderly. We understand that we can’t reduce pensions, just like we can’t increase taxes or social benefits. This is not our way, so we need to increase the pension age,” Mr. Lukashenko reasoned.

Experts have calculated that the measures will reduce the deficit of funds of the Social Protection Fund while also ensuring the growth of GDP by more than 1 per cent starting from 2019. If the reform had been implemented last year, around 142,000 people wouldn’t have retired and the country would be able to save almost $260mln.

The signed decree is only the beginning of the pension fund. At present, a joint approach is seen where some people work and pay dues to the Social Protection Fund while others received pensions. We’ll take the best from the experiences of other countries and will adapt this to our Belarusian situation.

In Belarus a worker receives the retirement pension if they have made payments into the state non-budgetary Social Protection Fund for at least 15.5 years. From January 1st, 2017, the length of pension insurance paid will be raised by another six months and will be increased until it reaches twenty years. Without the necessary years credit, people will be able to receive only social pensions

By Vladimir Mikhailov
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