The Ministry of Labor proposed to postpone changes in the calculation of funded pensions until 2025

The Ministry of Labor and Social Protection proposed to postpone the transition to a new funded pension calculation scheme for two years. About it informs RBC with reference to the draft resolution prepared by the department on amendments to the methodology for assessing the expected period of payment of the funded pension.

“The indicated changes are proposed in order to prevent a sharp change in the duration of the expected period for the payment of funded pensions for insured persons who will apply for a funded pension in 2023–2024,” the ministry explained.

The amount of the monthly funded pension depends on the settlement period of payments. It was expected that the transition proposed by the Ministry of Labor to the calculation according to Rosstat (in terms of the number of men and women aged 60 and 55, respectively, and their expected life expectancy) would begin in 2023. This period was set in 2020.

If the plans had been implemented on time, the expected period of payment of the funded pension could have been reduced compared to the current value (22 years). On the contrary, the monthly funded pension would have increased. The Ministry of Labor does not provide new calculations for the expected periods of payments, writes RBC.

Life expectancy in Russia decreased in 2020-2021. due to the coronavirus pandemic. As Professor of the Financial University Alexander Safonov noted, if the state focused only on these statistics, then the amount of the monthly payment would be larger.

Evgeny Yakushev, head of the HSE Pension System Development Laboratory, added that the new scheme for calculating the funded pension according to Rosstat data was introduced in order to “bring this indicator in line with real statistics.” Otherwise, according to the expert, the Pension Fund and non-state pension funds (NPFs) would assign pensions at a loss.

Yakushev clarified that in the situation with fluctuations in life expectancy due to the pandemic, it is better not to change anything at all, which the Ministry of Labor did.

Pension savings appeared on the accounts of those Russians who, during the period of work after 2002, transferred contributions to the funded pension. Since 2004, only those born in 1967 and younger have remained in the system.

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