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Pension Stunt. Why the Pension Reform Is Dangerous

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CASE Ukraine`s Senior Economist Volodymyr Dubrovsky commented to the ‘Focus’ magazine on pension reform novations.

Ministry of Social Policy of Ukraine does not understand the probability of off-the-books employment. The minister of Social Policy has no understanding of what the economy is.

The proposal contradicts to itself. Minister of Social Policy says about the action of solidarity system. In fact, ше means that people who save up for their retirement should receive it, regardless of whether he or she works. This is how the solidarity system works. It does not depend on the disability or life conditions of the person.

The state cannot leave a person in the lurch, who is not able to provide for himself. He should get some help. In a normal social state, this aid may not be less than the living-wage. Minister of Social Policy just has to understand that the social function of the state is not to let anyone die of starvation.

We need a transition to the payment of social pension, when a person gets from the state certain maintenance, depending from nothing, just after reaching the retirement age.

The Pension Fund as a separate fund should not exist. It cannot provide for itself and offer attractive conditions for retirement, when it would be advantageous to make pension contributions.

Read the full article [in russian]

February 16, 2017