The Government will discuss a new funded pension system, individual retirement capital, in 2020. Some of the provisions for the new system have been relaxed.
The individual retirement capital program will not affect current pensioners and will cover current workers. The program will help to change the state funded pension system which was frozen in 2014. Workers will be able to make their own contributions (and determine their amount) to the new system. The funds will be transferred to non-government pension funds. The contribution will be gradually increased every year, from 0.5% to 6%. It is also expected that future pensioners will be able to increase or reduce their contributions. The accumulated funds will belong to the contributor rather than the government.
Finance Minister Anton Siluanov commented that the discussion of the new funded pension system had to be postponed due to a negative response to this year’s reform. He added that the dust may settle down in two years. He also confirmed that the individual funded capital will be voluntary.
The Russian Government has not yet decided when the bill on the new funded pension system will be submitted to the State Duma, Vedomosti reports. However, the minister said that the Finance Ministry is ready to do it any time. Initially, the ministry planned to introduce the second pension reform in 2019.