Regular academic workshop “Active Ageing Policy and Pension Reforms: Russian and International Experience”
The Institute for Social Policy (ISP) at the National Research University – Higher School of Economics is hosting since 2019 a regular academic workshop “Active Ageing Policy and Pension Reforms: Russian and International Experience”.
The workshop is to encourage academic and expert discussion on social policy development, aging population, active ageing, and pension reforms that are to be based on research and international experience.
The workshop favours an interdisciplinary approach and expects to bring together Russian and foreign experts in different fields such as economy, law, sociology, demography as well as decision-makers dealing with these issues.
The workshop is to focus on three key topics:
(1) social and economic dimensions of aging population and active ageing;
(2) pension reform;
(3) social insurance and its improvement options.
Academic Leader – Oksana Sinyavskaya, Deputy Director of the Institute for Social Policy.
Project Coordinator – Olga Voron, Advisor to the Director of the Institute for Social Policy.
On March 21, 2019, the Institute for Social Policy at the National Research University Higher School of Economics held the second academic workshop devoted to the Future of the Pension Savings in Russia and in the World organized in cooperation with the World Bank within the series of events under the topic “Active Ageing Policy and Pension Reforms: Russian and International Experience”.
Over the past three decades, the attitude towards the funded principles of pensions financing has changed in the world and in Russia. It evolved from their idealization and perception as the only panacea for the aging population in the 1980s - 1990s to complete disappointment in their effectiveness and, as a result the crisis of 2008-2009, the cancellation of already initiated pension reforms, which introduced compulsory pension savings. It is clear now that, although the pension savings are also subject to the negative effects of aging, and do not serve as a tool for reducing informal employment or expanding pension coverage, they occupy an important place in the pension systems of many developed and developing countries where they complement the state pension schemes based on distributional financing principles. One of the relatively new approaches to organization of voluntary pension savings, which aims to expand the coverage of such programs, is the principle of auto-subscription or automatic registration. In line with this approach in Russia, the Central Bank of Russia and the Ministry of Finance are developing the concept of individual pension capital.
Our second workshop in the series of events under the topic “Active Ageing Policy and Pension Reforms: Russian and International Experience” will discuss the role of pension savings in the contemporary pension systems with the focus on demographic and economic challenges, as well as the lessons, which the developing countries can learn from the countries that already apply the principles of auto-subscription in their voluntary funded pension schemes.
SERGEY BELYAKOV, President, Association of private pension funds (ANPF)
Russian pension system framework and trends in socio-economic development
According to the Russian Federal State Statistic Service (Rosstat) data, the life expectancy in the Russian Federation can reach 73.25 years for males and 80.78 for females by 2035. At the same time, there is a continuing trend towards population aging, and the demographic dependency ratio is constantly growing. Decreasing the number of employees and growing the number of pensioners are of a global trend. The federal budget expenditures transferred to the Pension Fund of the Russian Federation annually increased are of 3.3 trillion rubles now, which correspond to 20% of the total federal budget expenditures, and will keep increasing according to experts’ estimates. To maintain pensions at the current level with their adjustments only by the inflation rate over the period 2024-2026 will require to increase the transfer from the federal budget to the Pension Fund of the Russian Federation of at least 5 trillion rubles. Under the population’s disposable income falling steadily down, the current pension system while trying to attempt 40% replacement rate will continue to generate poverty and a permanent shortage of insurance contributions to pay insurance pensions diverting federal budget resources in case the funded component of the pension scheme will not be reintroduced.
Dr. HEINZ RUDOLPH, Lead Financial Sector Economist, World Bank
Pension Funds with Automatic Enrollment Schemes: Lessons for Emerging Economies
The presentation will cover main findings from the recently published research paper “Pension Funds with Automatic Enrollment Schemes : Lessons for Emerging Economies”. Since the introduction of the KiwiSaver scheme in New Zealand in 2006, several countries have implemented, or are in the process of implementing, voluntary funded pension systems with automatic enrollment features. Since most of the literature has focused on countries with the common law tradition, including the United Kingdom and the United States, this paper analyzes cases of countries with the civil code tradition, including Turkey, Poland, Chile, Brazil, and the Province of Quebec in Canada. This sample includes mostly emerging economies, with reforms at different stages. Although they are not a substitute for necessary parametric reforms, automatic enrollment schemes offer the possibility of improvements in future retirement income for a significant part of the labor force. The perspectives of the Russia Federation will be analyzed and based on these country experiences. This note stresses that the paternalistic approach of automatic enrollment schemes imposes a great degree of responsibility on governments and requires careful consideration of the design of the system, including the industrial organization of the pension fund industry and default investment strategies. Sufficient time and resources for preparing communication and educational campaigns has played a key role in achieving high rates of participation.
OKSANA SINYAVSKAYA, Deputy Director, Institute for Social Policy, Higher School of Economics
EVGENIY YAKUSHEV, Executive director JSC NPF Safmar
YURI VORONIN, Center Director, Center for Legal Support of Social and Economic Reforms, Institute of Legislation and Comparative Law under the Government of the Russian Federation
On February 28, 2019, the Institute for Social Policy at the National Research University – Higher School of Economics hosted the first edition focusing on social insurance development of the regular academic workshop “Active Ageing Policy and Pension Reforms: Russian and International Experience”.
The fate of Russian obligatory social insurance system is the permanent topic of the heated expert discussions and the object of various reforms. The most important aspects are pensionary insurance and obligatory health insurance. Nevertheless, no satisfactory result was reached in the improvement of insurant persons (which in one way or the other include the whole population of the country). The new changes that under discussion now are of a superficial character and, if we can judge by the knowledge accumulated over the last decades, will bring at best only short-term positive effect.
According to the report commissioned by the Center for Strategic Research, the obligatory social insurance system in Russia needs radical institutional (not fiscal or parametric) changes. The changes should reimagine the role of government and private agencies in the field of insurance. It is obvious that such changes need several years of preparation and discussion, both expert and public. That is the only way to make these changes socially, economically and politically effective.
The seminar heard the authors of the Obligatory Social Insurance: Ways to Reformation report.
Evgeny Gontmakher, Coordinating Board Member, European Dialogue Expert Group, and Professor, Higher School of Economics
Obligatory Social Insurance System in Russia: From the Imitation To a Real Institution
There were many attempts to reform the social insurance system in Russian created in the early 1990s, but it is still one of the channels of budget, not insurance financing of social policy. The only way to turn this system into an effective institute is via its denationalization and its active involvement into the functioning of all subjects of the social life of the country.
Alexander Safonov, Vice Rector of Academy of Labor and Social Relations
Reform of Social Insurance System: Main Macroeconomic and Institutional Challenges and Real Answers
The main problem with the reforms of social insurance in Russia is the lack on consistency, which could allow making decisions that take into consideration the most important factors influencing stability and sustainability of obligatory social insurance in middle- and long-term perspective. The majority of the fundamental innovations in the obligatory social policy were introduced with limited analysis of the country’s socio-economic development distinctions. They were based on the mechanical transfer of some other countries’ national cases. Those countries had different economic levels, different employment structures, and different sets of political and social institutes. That is why it is crucial to continue the discussion on the ways to develop obligatory social insurance.
Yuri Voronin, Center Director, Center for Legal Support of Social and Economic Reforms, Institute of Legislation and Comparative Law under the Government of the Russian Federation
Concept Approaches to the Modernization of Compulsory Social Insurance in the Postindustrial Society
Today the Russian society has to choose an optimal model of social welfare, which will become a foundation for the country’s social development in the long-term. To make a long-term decision on the architecture and the principles of the functioning system, we have to examine all pros and cons of the three potential approaches to the system building-up (insurance, savings, and budget) and all possible options of the combined application of all three.
Oksana Sinyavskaya, Deputy Director, Institute for Social Policy, Higher School of Economics
| Valentin Roik, Chief Research Fellow, All-Russian Scientific Research Institute for Labor, Ministry of Labor and Social Protection of the Russian Federation|
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