The Bank of Russia is preparing proposals for reforming the pension system, according to the Shanghai journalists the head of the Central Bank Elvira Nabiullina. According to her, Central Bank is considering the option where all citizens, including the so-called “undecideds” will participate in the pension system.
“From a storage element not to be missed. Let it be transformed, but it needs to be saved,” — said Nabiullina (quoted by “Prime”), adding that the pension system should be built in such a way that workers were motivated to accumulate. “The government should create reliable instruments of such savings, in which citizens will believe,” said she.
The Central Bank assured that for the formation of voluntary savings incentives need to be developed. “We were just discussing them. There are different options: including tax, with options for automatic “subscription” to the accumulative system, that there is in other countries,” Nabiullina said, adding that for the development system, it is important which version of the formation of pensions offered to the citizens by default.
From 2016 all Russian citizens are by default participants in the distributive pension system (contributions of employed people in full go on pensioners). Until the end of 2015, the citizens had the opportunity to write a statement and become a participant of the funded pension system, in which 6% of contributions go to your own accumulation. Thus since the beginning of 2014, the contributions of citizens did not accumulate, as the government declared a moratorium on formation of accumulative part of pension.
The Bank of Russia does not exclude the extension of the moratorium on formation of pension savings for 2017, said the report by the Central Bank “the Basic directions of development and ensure the stability of the financial market of the Russian Federation”, which was published on 2 December 2015. “There is a risk of prolongation of the moratorium on transfer of pension savings in private pension funds in 2017 and subsequent years”, — the document says. It “will negatively affect public confidence in the defined contribution component of the pension system and, consequently, will help reduce growth of long-term investments”.
According to Nabiullina, the Russian pension system is not balanced. “So all the time there are questions that the financing of the insurance part of the need to submit those payments that go to a fully funded system. This issue will always exist, until we have a total balance of the pension system,” she said.
Accumulation pension system not only helps to increase the level of pensions, but also provides economy long-term money, said Nabiullina. “Based on these long-term money may develop the financial market and, accordingly, to be financed, the economy and investment projects. This is an important structural element for the entire financial and economic system”, — said the head of the Central Bank.