Another version of the bill on compulsorily funded pensions has appeared in parliament, proposing to allow the accumulation of mandatory pension contributions in a nonprofit from 2026.
In Ukraine, they want to connect all categories of working citizens to the funded pension system until they reach the age of 55. At the same time, employers want to be obligated to pay retirement contributions in favor of employees. This is stated in the draft law “On the funded pension provision”, posted on the website of the Verkhovna Rada on April 17, 2023.
According to the draft, the pension contribution amount for employers is calculated for 3 years. They will pay:
- 1% of employee wages in 2023;
- 1.5% – in 2024;
- 2% – in 2025.
At the same time, co-financing will be provided from the state budget on a parity basis. At the same time, the size of the combined social contribution (SSC) paid by the employer remains unchanged, the cumulative contribution is made to the combined social contribution.
The authors of the initiative propose to start a unified model of the functioning of the funded pension system. In other words, it will be possible to accumulate contributions to the authorized pension fund created by the state until the end of 2025. After that, citizens will be able to choose for themselves any authorized non-state pension fund, which will receive contributions in their favor and accumulate pension payments.
In the explanatory note to the document, “The pension savings of pension fund participants are protected from depreciation and inflationary effects mainly due to their investments in conservative monetary instruments. Investment restrictions on the valuation of pension savings are determined by a draft law based on a prudent investment strategy.” says.
In addition, it has been proposed to establish a system in the compulsory pension system that guarantees the stability of this system and the pension savings that will ensure its participants’ confidence in maintaining their own savings.
“An additional system of guarantees for the protection of pension savings in the funded pension provisioning system is strict requirements for admission to work in the system and control over the activities of organizations that serve the funds of participants in this system by state regulators.” authors of the document note.
By the way, the authors of the Draft Law “On the Provisions for Funded Pensions” are more than 20 deputies of the Verkhovna Rada:
- David Arahamia;
- Galina Tretyakova;
- Ruslan Stefanchuk;
- Alexander Kornienko;
- Mariana Bezuglaya.
To rememberFocus In the article “Millions for old age. Why Ukrainians need funded pensions and how will it affect payments”, he explained whose contributions will go into savings to pay pensions to those who are 10-30 years into retirement today.
More experts said in September 2022 Focus What When introducing the funded level of the pension system, there may be a certain percentage of income that will certainly go (accumulate) to a citizen’s future pension, but there must also be an option to opt out of such an obligation so that citizens can decide. Where and how will they save money for their old age themselves.
Source: Focus
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