Pension reform: people do not explain anything and hit with a brick on the head

The Russian government plans to raise the age of retirement to 63 years for women and 65 years for men. Why this measure is inevitable and leads to the growth of poverty and sulfur employment – economic-geographer, Director of the regional program of Independent Institute for social policy Natalya Zubarevich.


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Pension reform – a special operation in the mode of Abraham

Natalia Zubarevich

– Many experts say that pension reform is a necessary measure. Is it really so?

The word “necessary” does not fit here. This is an inevitable measure. Here and no questions, enough demographic pyramid to see. Another thing is that it was carried out badly.

The measure was primarily fiscal, to relieve the pressure on the Federal budget. Insurance payments in the pension Fund to cover approximately 55% of spending on pensions. The rest is transfers from the Federal budget. Three years – the 15th, 16th and 17th – the Federal budget was in deficit, i.e., expenditure was more than income. The problem had to be solved, but the way it is done in Russia, is not done.

First, it is necessary with the people to discuss, to explain what is happening. We also like special operation conducted.

Secondly, it is made in the mode of Abraham and quickly: will be added for six months per year from 2019.

In developed countries, pension reform was discussed a few years and then its beginning was delayed so the people somehow adapted. We have brick on the head. Therefore, the people rebelled.

But the main reason of discontent is absolutely clear: those who are soon to retire, is expected to be able to continue to work. First, young retirement years works more than 60% of men and almost half of the women. They all receive a pension and salary. Now they are deprived of this, and in the province of 10-13 thousand for tangible money. Of course, people are dissatisfied.

– Was it possible to reform efficiently? Was we have these years to adapt?

Was. In 2003-2005, already it was clear with the age pyramid, it was clear that in 90-e years were very low birth rate, and those born in the late 40-ies – 50-ies, soon to be retired, and that a very large generation. So then had to talk to people, to explain. At the same time in parallel, it was necessary to improve the health care that our men did not die. They die in the working-age very active – drink less necessary.

It was necessary to do a comprehensive history, but did so. Pulled 15 years, and suddenly everything is ready. In all countries, the increase in the retirement age took place through a public discussion, was very gradual introduction of this reform.

Happy does not happen, people need to be convinced why this is necessary. Completely reasonable questions: why the security forces remains a retirement at 45 why all Northern benefits are retained, including early retirement, and more many such “why”. But no answers.

Raising the retirement age is inevitable, it is not reform, it’s fiscal history, to unload the Federal budget, but spent it all disgracefully, a brick on the head.

Protest in Saratov

– There have already been attempts to change the pension system, for example, funded pension…

– Yes, and this contributory pension gloss. When the Federal budget needed money in hard times, in the 13th and 14th year, they just took the money from the funded part of pensions. You see, when the government is so, there is no credibility.

– So that didn’t work, and why the current reform?

– But where to go? The population will go columns to protest? I don’t think.

– But there were already rallies.

– Well, how many people came, talked a little bit. But do you think that thousands and tens of thousands of people will come to the area? The kitchen pomerjatsja and will continue to live. The government knows very well their people. Buzz are those who will soon retire. It is dispersed. Note that North did not touch pensions, because then it would be buzili regions concentrated.

People will be left with a feeling of injustice

– Age 63 for women and 65 for men is generally adequate numbers? We can?

– What is the mode of operation? First fast run, with no one discussing how the monetization of benefits, staggered start, and then, if you went to the protests to roll back. Monetization is additionally filled with cash to people off the streets. Here and now do everything as in a normal two-mover: announced men 65, women 63, in the end, women will make 60 men 63. It’s the usual political history – the government is bad, President is good.

– Do not live to retirement is a real prospect for us?

With women, we all right. Women live in retirement for 24 years, it’s in the best Western countries. Will to live, respectively, 20. As men we live to retirement age not so much. We have a very high mortality in the working ages – denatured drink less and a lot more problems.

Those who retired to the living, live on it for 13 years – not so much, but not terrible. Therefore, the average life expectancy is virtually nothing said about pensioners. This is the average temperature in the hospital. It’s the guys who crashed on motorcycles, driving drunk, those men who are 40 years took to drink, and so on. Therefore it is not necessary to look at average life expectancy. Women have done, and the men very much die in working age, that is the problem.

In this case, besides that people won’t be able to work while receiving the pension reform will change?

First – people will not be able to get extra money. Those who had a low salary, with age, revert to an even worse position, their value in the labour market will be reduced.

If the pension plus the salary of the withdrawal of such people more or less tolerable standard of living, now they will lose this opportunity. This is a serious risk of poverty.

The second is people will be even less trusting of government, but they are so she’s not very trusting.

Third – people will feel a strong injustice. This feeling is well familiar to Russians, and then it will increase. What this political impact, I don’t know. Remember the old story – the Lord is patient and told us. Most will live under the same scheme.

– In regions where in General people are worse, than in Moscow, the changes to the pension system will be more tangible?

– There is less chance of finding a job. In Moscow young retirees almost all the work. And some small, distant town – what there jobs? For them, the pension was a great help. In poor regions and, in General, for a poor population, this impact is stronger. And in rural areas the situation is generally such that the grandmother, often a nurse, she has a stable family pension and children enjoys it. Now will be too late to get it.

Humanly speaking, everything is clear. For ordinary poor people is serious material damages.

– Another promise that soon the machines in many industries replace the person and then the labour market will be very not to know…

– Listened to and forgotten. Let’s go for 200 kilometers from Moscow, will see what the machine replaces the man, and stop this stupid talk. Our country is not the state, are not at a stage of technological development that we sang about cars.

I was just wondering about the fact that while in Russia there are a lot of factories hazardous industries, where people, especially men, work wear. They also 65 to retire?

– Harmful production is not touched. They have introduced one more addition – the part of the insurance business pays. If you can’t make your production less messy and hazardous pay.

So this is a reasonable and understandable story. You’re anxious at this aluminum plant, ruined health, and during this state you will release before retiring, and the business innocent. It’s insanity.

No matter how much you work, your pension will be a little more minimal

– Many refer to the fact that Europe has been the age of retirement raised. Here in Germany soon to 70 will work. But is it fair to compare us and them, at least given the standard of living and wages?

– It’s not even a question of wages and standards of living, and the question of longevity. There, women live 7-8, men more than 10 years older. Accordingly, there are simply different accommodation, living out and in the 70 years of the people feel quite healthy and energetic.

Secondly, there is a higher standard of living and pensions are not comparable with the Russian. They follow the recommendations of the International labour organization that the pension may not be less than 45% of salary. This is called the replacement rate. We have it now is 33-34%, and if nothing changes in the retirement age will be 23%. In Russia it was already so in zero. Pensions accounted for 23-24% of the average wage. It’s crazy. Then made the valorization and caught up to 35%. Now about 33%, and the percentage is constantly falling.

Due to the fact that the pension is low, people earn quasi-legally as you can. That’s exactly what will happen, so it is the strengthening of the gray employment.

But until the process is completed, and, of course, will be rolled back from the original versions. Now there is increased discussion where the rollback happens at what levels. The main thing now is to tell people – Buzite. Buzite, that the conditions were sparing to increase the retirement age applied not only to ordinary pensioners, but for all people: a huge number of security forces, military and so on.

The main thing that it was a comprehensive reform, to enable people themselves to accumulate for their retirement. How much would you now not worked and not earned, your pension will differ in the best case, two to two and a half times the minimal salary, it’s ridiculous.

– You mean that you need to return the funded part?

– Of course. Not all through of accumulation, but the funded component should be. It brings in people the habit of long term planning. They 30 already thinking about what awaits them in retirement, what they will have deductions. But this requires a little detail – people must trust the government to understand that what they accumulate, will not go to pieces. In our country trust is a big problem.

– To summarize, changes in the pension system is beneficial only to the state or need to understand that it is important for us?

– There are situations are inevitable, like a disease. We consider them in terms of benefits? We are a society that is aging rapidly. It is not beneficial to anyone, but it is inevitable. Therefore, in this situation anyway something has to be done.

To discuss with people, to explain the inevitability, to show, to offer options, the whole world, the whole country to talk about it and make a decision that more or less would suit the majority. This is an option for civilized countries.

The second option is to quietly and quickly decide to declare that is so. You swallow, and we’re still a budget fix that, we will not have such a large transfer to the pension Fund. We chose the second way because we’re such a country: the people do not explain anything, and beat with a brick on the head.

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