Government's bill on pension reform is a landmark decision - a meeting of Volodymyr Groysman with group of experts

The Government's bill on pension reform which was introduced to the wider public on May 17 - is a major and landmark decision seek to restore social fairness principle and to preserve the pension system of Ukraine in its capacity as such. This was stated by representatives of the expert community during the meeting with Prime Minister of Ukraine Volodymyr Groysman. The meeting in format of meaningful talk was held upon the initiative of the Head of Government.

Volodymyr Groysman presented key aspects of future reform, inter alia updating of pensions, introduction of a new formula for calculating payments based on average pay as well as of schemes for pension entitlements and pension insurance record that will provide an opportunity to reduce shadow employment, to provide a possibility to increase additional payment for labor experience, to remove in 2018 early retirement for teachers, doctors, social workers and to extend the rate of unified social contribution (by 15 and 7%), for harmful and heavy industries preferential retirement will be preserved for employees.

The Head of Government stressed that in case of approval by Parliament of pension reform, retirement payments to be raised starting October 1 for  5.62 million pensioners in the medium term - to achieve the deficit-free budget of the Pension Fund and to introduce in 2019 savings programs for workers of certain occupations, for example for miners.

The Prime Minister stressed that in order to implement offered incentives it is necessary to allocate a sum worth UAH  12 billion and these funds will be provided due to increased revenues to the Pension Fund after the doubling the minimum wage. In 2018 Government's proposals will require UAH 30 billion. These resources will be allocated through the further growth of incomes of the budget of the Pension Fund, the deshadowing of the economy and through improvement of the payment discipline in terms of payment of the unified social contribution.

He recalled that the draft law had been already submitted to the National Reform Council for further consideration under the President of Ukraine and expressed hope that the Government's proposals will find support in the National Reform Council and later in the Parliament where they will also be considered.

“We specifically focused on the pension changes. We believe that we found the format that can enable us to solve a number of problems pertaining to pension system and will allow us to move on, to continue pursuing reform of the pension system, underlined the Prime Minister. I would really like  this reform to be kicked off. To this end, we need support of the Parliament as well as of the expert community".

In turn, a group of experts commended the significant success of the measures taken by the Government. Moreover, Executive Director of the Centre for economic strategy Hlib Vyshlinsky determined the Government’s bill on pension reform as a“ landmark decision for Ukraine”.

“I also wish to commend the work carried out by the Government concerning this reform”. I would like to call it “momentous decision”. In my opinion, this is one of the most crucial economic reforms which were implemented in Ukraine, especially with regard to the approach regarding improvement of social fairness principle due to amendments in term of labor experience”, urged the expert.