Pension system modernization

Ministry of Labour and Social Protection of the Population has published proposals to change the concept of further pension system modernization. Draft resolution is published on the Open Legal Acts website. Public discussion on the portal will last until November 12.

It is proposed to switch from basic pension payment to minimum guaranteed pension from 2028, according to the concept published by the Ministry.


In this regard, it is proposed to:

• establish a minimum guaranteed pension in the amount of 70% of the subsistence minimum for persons who have less than 5 years of experience in pension system;
• determine basic pension of 70% of the subsistence minimum for five years of participation in pension system, and its amount will increase by 2% for each year over 5 years.
• cancel the basic pension assignment;
• minimum guaranteed pension for successful recipients of basic pension is calculated on the basis of the length of service in pension system taken into account when calculating the amount of basic pension.

"At the same time, right to old — age pension payments remains if there is at least 6 months of work experience as of January 1, 1998", noted in the concept.

In addition, to maintain the size of solidary pensions (solidary pensions are awarded to those who worked before 1998 with a minimum work experience of more than 6 months) at an acceptable level under the current pension legislation, their amounts will be indexed annually ahead of the inflation rate by 2%.

Amount of monthly pension payments from the UAPF is calculated as one-twelfth of the amount of pension savings by coefficient of their current value at the appropriate age of recipient.

It is also proposed to introduce separate coefficients of the current value of pension savings for employees engaged in hazardous industries, as well as for disabled people of the 1st and 2nd groups (divided by gender).