The government decided to return the funded part of the pension

The Ministry of Finance and the Central Bank decided to return the funded part of pensions to Russians in 2019 and, as Vedomosti learned, have already developed a bill that they expect to pass during the autumn session of the State Duma. A fundamental difference from the previous system is that savings are proposed to be made the property of the employee himself, and not the state.

Details

• The new individual pension capital (IPC) should replace the state funded pension system, contributions to which have been frozen since 2014. The employee will be able to decide whether to make savings contributions or leave them zero, but by default they will be 6% (the increase will be gradual - by 1 percentage point per year for 6 years).
• The document also proposes to admit insurance companies to the IPC, but through the instrument of pension annuities, Deputy Minister of Finance Alexey Moiseev told Vedomosti. In this case, contributions will go to Non-State Pension Funds (NPF), and a person will be able to receive the accumulated amount and transfer it to insurers for pension payment only upon reaching retirement age.
• Insurers will be able to access premiums only after an assessment of the market’s performance by a separate regulator, Moiseev clarified. This could happen within a few years, another official said.
• The basic scenario has already been agreed upon at a meeting with Siluanov; the minister wants the bill to be adopted by the State Duma during the autumn session, a meeting participant told the newspaper.

Context

• Contributions to funded pensions were frozen in 2014; now they are accumulated in points - and it is impossible to determine at what “rate” the points will be converted into rubles. You can read more about this system here .

The fundamental difference between the new funded pension system and the old one is that, according to the project of the Ministry of Finance, it is proposed to make savings the property of the employee himself, and not the state, as was the case in the previous system. But does this mean that the state will not be able to take them away, as happened last time?

Artem Gubenko