Pensions for working retirees in 2020
Recent events in the pension sector have left many Russian citizens unaware of their future. This is due to the difficulty of interpreting norms and laws. After all, why should an ordinary welder or driver delve into the intricacies of the legal profession? He has enough of his own worries. And if the family is large, it’s not at all that time, no strength will be enough to study the countless Talmuds of bureaucratic writings. But still you can’t be in the dark. Moreover, pensions for working pensioners in 2020 will remain unindexed. How can this be? But very simple. The state is developing the budget. All the details in today's review.
Will pensions be indexed: latest news
The answer to this question excites the inquisitive minds of every Russian. See how any meeting of the highest officials of the state with the people takes place. It can be an open press conference with the president on the line, a visit of the prime minister to the regions or the outback, it does not matter. One question remains unchanged: will the pension be increased?
According to established tradition, all changes regarding economic issues have been taking place since the new year. So it’s easier to consider: the year has begun, and with it innovations can be applied. Therefore, without violating the prevailing foundations, in the next 2020 we can expect an increase in pensions in Russia.
For existing pensioners who have been receiving old-age benefits for more than a year, the main thing is that they transfer more money to the card. So it lives calmer. It is true, because every year life rises in price. Rising prices for food, utilities, medicines. All this requires big savings.
But those who are only going to cling to this category of people are often interested in the question, due to what indexation will occur in the country? After all, money is transferred from the PFR (pension fund). And there they get exclusively from the wallet of the working population (officially arranged).
If we consider the ratio of the number of pensioners to the working population in 2009, and the forecast for 2020, we get the figures 1/3 versus 1/2. In simple words, 10 years ago there were 3 hard workers per pensioner. Now this figure has accordingly decreased by exactly one worker. That is, to provide all Russians with a well-deserved rest, now workers will have to pay more in the FIU. It is so?
But what then do parliamentarians promise a pension increase? How to ensure growth?
Is reform a panacea or a necessary necessity?
In 2014, the top government was already considering increasing the retirement age. This is evidenced by the publicly available research of one media outlet. In the analysis, experts consider the situation of the pension sector up to 2030. Several scenarios are written, one of which is a planned increase in the age of going on a well-deserved rest.
That is exactly what the government did in 2018. With this innovation, annual indexation of retirement benefits is now possible. But here, not only this aspect influenced the decision of officials. The ever-growing budget deficit of the pension fund, cracking at the seams, did not allow covering the requirements for payments to existing pensioners now, not to mention the future.
For two consecutive years, the highest authorities had to deal with the redistribution of the federal budget in order to ensure a happy old age for citizens. But for a long time this could not continue. And at the end of 2018, 350 decrees were published. The document introduced changes for several categories of citizens, future retirees.
Some experts note that it was possible to close the gap in the budget of the FIU without resorting to such drastic measures. But the current government did not take this opinion into account.
How much will they increase?
Parliamentarians promise to index the average size of citizens' pensions by 43% by the end of 2024. To this end, a systematic increase in old-age security will occur every year. The current president of Russia V. Putin took care of this.
The fact is that the State Duma, having approved the bill on pension reform in the first reading, was forced to include the president’s amendments in the second reading. All changes that the head of state made are recorded in order number 1633.
Here are the numbers indicated in the document:Planned Indexing Table
As can be seen from the table, in 2020 the country expects an increase in the average pension indicator by 6.6%. Now the amount of payments is 13.4 thousand rubles. According to forecasts of officials, already in 2024 this figure will be brought up to 20 thousand per month.
And here is the data from another source. A diagram of the increase in pensions up to 2034 is given.
But it is worth noting the following. At the level of the law, only indexation until 2024 is approved. That is, it’s impossible to know for sure how much pensioners will receive in 2034, based on the diagram.
We turn to the law, which determines the growth of the amount of retirement benefits for old age. This is a decree under number 350. The same document that extended the age of retirement to millions of Russian citizens by 5 years. But someone was more fortunate. Workers of pre-retirement age have established a transition period, which provides for an increase in the first 2 years by half a year. For subsequent citizens, there is also a benefit - those who plan to go on a well-deserved rest in the first 5 years after the adoption of the law will also do so earlier. For others, the age is: 65 for males, 60 for females.
Let us return to 350. In addition to the main provisions establishing the age and other features of the innovation, in article 10 (almost at the very end) such data are written.
- In paragraph 7, the cost of 1 pension ball is determined each year, starting from 2019 and ending with 2024. The numbers correspond to the third column from the table with the corresponding name (given earlier in the article).
- Paragraph 8 indicates the amount of a fixed payment for the same period (2019-2024). And this data corresponds to the second column of the table.
- For a uniform understanding of these norms, the previous paragraph 6 of clause 350 of the decree sets the date from which the increase is made. The legislator chose the standard number - from January 1.
Since indexing is now carried out from the beginning of the year, the previous rule, which provided for an adjustment on February 1, as well as April 1 (if necessary), is no longer valid. It was canceled before the beginning of 2025. After the average pension reaches 20 thousand rubles in 2024, indexation will continue according to the previous rule.
It is these two components that are subject to adjustment for the annual index of the increase in the cost of living of the population (or inflation). The formula for calculating the amount of pension benefits, in addition to the two above, also includes the number of pension points that a hard worker receives for all his official seniority. According to the calculation, these points are multiplied by the coefficient of their value (from clause 7 fz 350), and the value of fixed payment is added to the value obtained (set in clause 8 of 350 fz).
Who will increase the pension?
Indexation of pensions according to the above schedule will not be for all categories of pensioners. The fact is that in Russia there are different professions for which pension financing is made from different sources. So, for ordinary citizens, the allowance due comes from a pension fund. But for law enforcement agencies, law enforcement agencies, the bureaucratic apparatus - from the federal budget.
In addition, benefits have a different nature of purpose. That is what it is about.
- Fees assigned upon reaching a certain age (old age).
- Upon receipt of significant damage to the general state of health (disability).
- Upon reaching the age at which further labor activity is not possible.
- When keeping a disabled person of 1 or 2 groups in their dependent.
- With the loss of the breadwinner.
- To the liquidators of accidents at the Mayak chemical plant and the Chernobyl nuclear power plant.
- Residents of the Far North and areas equated to such.
- Satisfaction for years of service and disability.
- Additional payments for rewards, participation in military battles.
The last two in the list are appointed by the military, as well as those who served in law enforcement agencies (EMERCOM, guardsmen, police). These categories, the so-called military pensioners, are also planning indexation of payments by old age, or, as in their case, by length of service. But the numbers here are different.
Particular attention is paid to those citizens who continued their labor activities while already retired. In 2016, a government decree was issued that amended the current 400 decree relating to the calculation of insurance pensions. Document number 385, signed by the president the day before (at the end of December 2015), determined a very interesting situation. Now since 2016, the indexation of the cost of 1 point, as well as a fixed payment, is not made to them.
After this innovation, the number of working pensioners in the country halved (from 40% in 2015 to 20% in 2018). But nevertheless, these categories observed a slight increase in the amount of their old-age allowance. This is due to the fact that pension points are accrued. Since the person continues to work (officially), the employer continues to transfer money to the pension fund, which, in turn, recalculates the amount of payments each year. Due to this, there is an increase in the final amount.
This state of affairs at the root does not suit citizens. Why should people who honestly earned their money and who can continue to work further should be infringed on? And for some, there’s no other choice but to continue to work in old age: we need to provide for our children. What does the state think about this? Are there any shifts?
After the approval of the reform and all its provisions, experts and political scientists undertook to interpret and comment on future innovations. Here is one of the assumptions published on the RBC website.
Analyzing the amendments to the bill on pension reform introduced by President Vladimir Putin, we can conclude that the large indexation of up to 20 thousand rubles, which the country expects in 2024, applies to all people on well-deserved rest, including working pensioners . Otherwise, the document would contain concretization for each category.
But after such an assumption, the Ministry of Labor immediately commented. These amendments apply only to non-working pensioners. For those who continue to work, the freezing of indexation will continue.
Minister of Finance A. Siluanov, speaking from the rostrum in the State Duma, uttered words regarding working pensioners. The official explained that indexation of pensions for these categories is impossible, since the country's budget is undergoing crisis times. But, already starting in 2020 there is an opportunity to talk about the growth of benefits.
The current budget of Russia was adopted until the end of 2021. The new document will be considered from the beginning of 2020 to 2022 and to the planned 2023 and 2024. Perhaps, starting from 2022, indexation will be introduced for workers. But this is still speculation. We must wait for the official paper.
There are many working pensioners in Russia. A particularly large number of them are concentrated in Moscow. This is because salaries in the capital are an order of magnitude higher than in the regions, and nobody wants to lose their jobs.
But not everyone can boast of such a state of affairs. For those who continue to work in retirement to provide themselves and their families with the necessary minimum, the Moscow government provided an extra payment to the local social standard. If the pensioner receives less than 17.5 thousand rubles in total with the salary, the mayor's office from the local budget pays up to this value.
What about military pensions?
Military seniority benefits are much higher than civilian benefits. At least that's what hard workers in civilian professions say. But here is the conventional wisdom. On one of the forums on the Internet, retired security forces are discussing a low pension. And besides this, such a question often arises: will civil pensions be abolished by the military?
The fact is that the security forces are currently entitled to two benefits at once:
- by length of service;
- upon reaching a minimum length of service in the civil profession.
The military are retiring at age 45. At this age, a person can still work. Yes, and sitting at home idle is very difficult, especially after the stormy burdens of service. So people go to work in civilian life. And having accumulated a certain amount of experience, they are assigned a second pension (old age).
This state of affairs offends civilian pensioners. They complain about their low benefits, looking at the warriors of retirees who receive two pensions per month.
Prime Minister D. Medvedev drew attention to this at a cabinet meeting back in 2017. He said that it is necessary to consider the possibility of canceling or suspending the payment of military content to those pensioners who decided to get a job in civilian life.
Let people choose either to receive decent military support after years of service, or to work on. Moreover, the amount of military pensions is decent.
Fortunately for the warrior, these words remained without attention. At least for now. Therefore, the military will continue to receive two payments at once.
The warriors are indexed at the annual inflation rate, which is indicated in the budget. As of 2020, 3.8% is expected. In 2021, this value is planned at 4%.
In addition, military retirees can count on an additional 2%. This is an adjustment of the reduction coefficient introduced in 2011 against the background of a general increase in the allowances of the security forces. As a result, in 2020 we have 5.8% of indexation.
In the future 2020, for people who continue to work after retirement, lawmakers have not provided for an annual increase in benefits. An increase in the age of going on a well-deserved rest should provide an additional influx of funds that can be used for various purposes, including the indexation of retirement benefits for hard workers. But so far this has not happened. The systematic increase in the retirement age continues. And maybe, after reaching the planned indicator and forming the country's budget for 2022 and subsequent years, the attitude towards working pensioners will change.