Finance Ministry urges Russians not to scrape and save for retirement

The new pension reform is aimed at creating a new product, the state pension plan, and requires improvement, Deputy Finance Minister Alexei Moiseyev said.

According to him, ministry experts knew from the very beginning that the project would require further development. The Deposit Insurance Agency, the Chamber of Commerce and other agencies made their comments after reviewing the document. However, most of the proposed amendments are technical, according to the deputy minister.

Alexei Moiseyev admitted that the ministry could have overlooked some rough edges, as the bill was changed several times. He added that the officials are ready to conduct an open dialogue with the market, RBC reports. Furthermore, the deputy minister explained that a new pension plan is needed because the current pension market does not offer enough products that citizens could easily understand and trust.

The official also explained that people will be able to transfer their investments from the compulsory pension insurance system to the state pension plan, but only after a so-called six-month cooling-off period. It is possible to apply for a transfer earlier, and the money will be transferred after the six-month period to the person’s account with the state pension plan. The minimum contribution will be RUR 100 ($1.60); the requirement is aimed at preventing Russians from making multiple one-ruble payments, the deputy minister added.

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