Deficit Reform

The head of the Pension Fund does not approve of plans to reduce the unified social tax

The fate of pension reform has recently been associated with the increased activity of Deputy Minister of Economic Development and Trade Mikhail Dmitriev. His public accusations against the government that it was moving too slowly on regulatory reform have already been marked with a warning for inadequacy. However, as it turned out, the sacrifices made by the official were in vain. The implementation of pension reform is not hampered by the lack of regulatory documents, but by serious technological problems.

The other day, the head of the Pension Fund of the Russian Federation, Mikhail Zurabov, said that the delay in the adoption of any government resolution is not capable of radically affecting the timing of the pension reform, since its implementation today depends, among other things, on solving technical problems. After all, the fund needs to distribute about 251 billion rubles across 70 million individual accounts. At the same time, funds for the fund come from three sources: the federal treasury, tax revenues and from the personal accounts of employers. And when checking these receipts, a lot of inconsistencies are revealed - in particular, the Pension Fund of Russia had a lot of “extra” money that was transferred to account for the debt to the fund during the liquidation of enterprises and today can no longer be identified.

According to Mr. Zurabov, “The Pension Fund today is a factory, in the workshops of which 10 million forms must be printed, sent to recipients, and processed notifications received.” And in the future, the Pension Fund intends to introduce technologies such as access to a pension account through a plastic card, the use of an electronic digital signature, and the assignment of a single social number to citizens, which allows the entire social insurance system to operate effectively.

But in addition to technical issues, when implementing pension reform, it will be necessary to solve a lot of financial problems. According to Pension Fund experts, the Pension Fund budget may become deficit by 2005. This is explained both by the negative yield on government securities, in which the fund is obliged to hold pensioners’ funds, and by the promised reduction in the single social tax rate as part of the government tax reform. The presence of free money in the Russian financial market today allows the Ministry of Finance to place GKOs and OFZs at 9% per annum with inflation of 12-15%. Negative yields provide the Ministry of Finance with a unique opportunity to simultaneously solve the problem of sterilizing “extra” money to contain inflation, and also receive income in the amount of the difference between the rate and inflation.

The reduction of the unified social tax envisaged by the government also does not arouse enthusiasm among the head of the Pension Fund. According to Mr. Zurabov, the government's policy of reducing the tax burden provides for a lot of sources of compensation for lost federal budget revenues, but does not compensate for the losses of the Pension Fund. According to the calculations of the head of the Pension Fund of the Russian Federation, a reduction in the unified social tax by 5% is not capable of radically changing the situation with the withdrawal of salaries from the shadows, but at the same time will lead to a loss of 200 billion rubles in income for the fund. The expansion of the tax base, which the authors of the tax reform are counting on, will cover only 30 billion of this amount. Compensating for the remaining portion will be a big problem.

Alexander GUDKOV