To stop the indexing: why retirees will lose from a one-time payment

“Now we do not have sufficient resources to carry out the indexing in the second half in the usual form, but condicionat pension you need is my position colleagues in the government,” said Prime Minister Dmitry Medvedev after a meeting in Hills with members of the government on Tuesday, August 23. Compensation will be offered to all retired and working, and not working, said the press Secretary of Prime Minister Natalia Timakova. More than 40 million people.

A one-time payout, according to Medvedev, “will help retirees to recoup losses from rising prices and will require more than 200 billion rubles from the Treasury. Medvedev has instructed the Finance Ministry to “find necessary for the payment of money,” noting that the budget in 2017 must be preserved. Payment should be extended to 43 million people, the money sought from the budget in 2016, said a spokesman for Deputy Prime Minister Olga Golodets.

Previously wrote that the government is discussing the allocation of funds for additional indexing from the so-called presidential reserve. This reserve of $ 342 billion rubles was formed in the 2016 budget, 150 billion rubles from them in the spring was allocated to support VEB. One-time payment in early 2017, most likely, implies that to carry out funds transfer through the Pension Fund not needed, says a source in the Ministry of economic development. The technique of these payments has not yet been discussed, said last week two officials of the financial-economic bloc and a source in the government. Doindeksatsii would require changes to the budget that was supposed to take the next Duma, said earlier a Federal official and a source in the government.

Medvedev said Tuesday that in the preparation of the budget to provide “all the necessary tools and, of course, on payment of one-time indexing”.

Medvedev also assured that the standard indexation of pensions in February next year will be held in full for inflation in 2016 and it will take more than 270 billion rubles. the Ministry of Finance in budget projections laid the indexation of pensions next year by 5.9%, saying at the end of June, Finance Minister Anton Siluanov. According to the official forecast of Ministry of economic development, inflation in the current year will make 6,5%, but the Deputy Minister of economic development Alexei Vedev at the end of June said that the price growth for the year may be less than — “at 6%, maybe even slightly lower — at 5.9%”.

No money

By law, pensions are indexed annually for inflation of the previous year. In 2015, the official inflation rate was 12.9%. But due to the lack of funds in a crisis budget for 2016 it was decided to index pensions only 4% in February, and then make the decision about the possibility of additional adjustment, based on the data about budget execution in the first half.

According to the FIU, the average monthly insurance pension in 2016 will amount to RUB 13 132, after indexing at 4%. But if pensions were indexed by 12.9%, while their average size would be about 14.3 thousand rubles — about a thousand rubles more.

By the end of the first half of the budget came in below expectations. The average price of Russian Urals oil for the six months amounted to about $38 per barrel and initially, the budget was calculated on the average annual price of $50. In the end, it became clear that the financial capacity for additional indexing no. “The crisis in the economy still being felt,” — said Medvedev on Tuesday. According to the Prime Minister, the budget revenues in the first half of the year was less by 11% than planned. And by the end of the year the budget revenues may be short of 1.5 trillion rubles. “But it is not yet clear, it is one of the possible negative options,” — said the head of government.

The idea of a one-time payment in lieu of the second increase occurred in April, wrote earlier . Besides it, the option was discussed with doindeksatsii pensions by 4%. That the government may waive the second increase in 2016, previously reported by “Vedomosti”. Officials understand that indexing is needed before the September elections to the state Duma, but it will inflate base for the next allocation and the budget for 2017, noted the sources.

How much will save the budget

If the government now decided to condicionat pensions to the level of inflation in 2015, it would require approximately an additional 130 billion rubles from September 1 to the end of the year, told earlier a source in the government. A Federal official called “statements” the amount of 137 billion roubles And next year the authorities would need to seek on a regular indexation of the order of 500 billion rubles, considering the raised base. “Doindeksatsii, unfortunately, inflate the costs in 2017, if to index pensions overall by 12.9%,” — explained a source in the Ministry of Finance. “The ultimate budget expenditures for 2017 already on the government was discussed and approved. What does this mean? This means that any other expenses must be cut. It is impossible,” he reasoned.

In other words, the decision to condicionat pensions in full, which the authorities eventually refused, plus the indexation of pensions in 2017 with a higher base would cost the budget about $ 600-630 billion RUB Alternative, which stopped the government, will cost about 470 billion rubles, follows from the statements of Medvedev, not to mention the fact that this year the extra money will not have to spend.

A member of the Duma Committee for labor United Russia Andrei Isayev told TASS that the lump sum to pensioners in the amount of 5 thousand rubles is equivalent to doindeksatsii pensions. But the decision will be “much cheaper” indexation of pensions, confirms the assessment of the Director of the Institute of labour and social security Ranhigs Alexander Safonov.

Lost pensioners

Retired after the failure of the government to the second increase will lose accrued pension points, said Safonov. The fact that the pension formula, in addition to the so-called fixed payment, indexed by the value of pension points. “To maintain the relevance of pensions the act provides for the indexation of your current income and at the same time, the indexation of wages, for which you accrued pension. This led to the fact that pensions were growing higher than the inflation rate,” — said the expert.

The disadvantage of lump-sum payment in the fact that, according to the Prime Minister, all pensioners will receive the same money regardless of the size of pensions and means-tested. From this point of view, the decision of the government — political and pre-election, says Safonov. “Here is implemented a campaign idea: people who receive low pensions, in fact, be interested in this project. 5 thousand RUB for them is a substantial amount, and they will win. For those who receive high pensions, is a bad decision, their pension is not fully proindeksirujut”, — said the expert.

Pre-election decision

“Of course, we could wait, when the dust settles and the political passions currently raging, there are significant economic problems that impede the fulfillment of obligations and which may be referred to. But I stand on position of principle: people need to be honest and not promise what we today can not fulfill, but to fulfill what is promised, even if in a slightly different form,” he said, explaining the decision to hold a one-time payment to retirees.

Deputy Director of the Institute of world economy and international relations Russian Academy of Sciences Yevgeny Gontmakher believes that the authorities before the elections “lay too big hopes for such populist measures as one-time payments”. “It seems to me that those who are engaged in elections in the administration [of President], slightly exaggerate the threat to United Russia, which is too low a result on the party lists”, — he said. In addition, it is an attempt to respond to the failed statements of the Prime Minister like that, which he did in the Crimea when he said the pensioners on the issue of indexation of pensions: “no Money, but you hold fast.”

Safonov of the Ranepa said that this decision is “political hope: the electorate will appreciate this decision, and the election less than wealthy people vote for the “United Russia”. Dmitry Medvedev — the leader of the election list of the party.

According to Gontmakher, the decision to pay “a significant impact on any electoral process will not have”, and how to react to the retirees receiving 5 thousand rubles, “hard to say”. “On the one hand, it’s good that fell off the money. But it could be the feeling that were given a lot more and trying to buy us off. But the value of this payment is exaggerated, and in the political and electoral sense. And the decision says more about the uncertainty,” he says.