Prime Minister Denys Shmyhal told how the government will update the pension system and how the point system for calculating pensions will work. Shmyhal announced this at a meeting of the Cabinet of Ministers, Ukrainian News Agency reports.
He called updating the pension system one of the government's priorities.
"The main goal is to ensure that every Ukrainian pensioner has a solidarity pension not lower than 30% of his average salary during his lifetime. Together with the accumulative component, which we plan to launch in 2025, this will be at least 50% of the average salary during lifetime," he said.
The Prime Minister noted that in 2024, UAH 896 billion will go to the Pension Fund, which is almost UAH 125 billion more than it was in 2023 - these are funds for pensions, subsidies, social insurance.
He confirmed that from March 1, 2024, pensions will be indexed.
"Next year we plan to make this indexation, like the entire solidarity system, fairer, clearer and more transparent. In the accrual of pensions, a point system will be introduced. It will align the disparities between long-retired retirees and those who have done so recently. Accordingly, payments to pensioners who retired earlier will be pulled up to the modern level," the Prime Minister said.
Shmyhal also revealed how it would work.
"Each month employed citizens pay a contribution to the Pension Fund. The contribution will be transferred to points in accordance with the ratio between the salary of a person and the average salary in Ukraine at that time. If you paid contributions from a salary that is the national average, you get 10 points. Above the average salary - you get, for example, 12 or more points, less than the average - will be less than 10, for example, 8 points. Then these points will be transferred back to the pension every year in accordance with the current average salary," he explained.
Thus, according to Shmyhal, the solidarity pension system will become protected from inflation and devaluation, and fairer.
As Ukrainian News Agency earlier reported, Shmyhal said that in 2024 the indexation of pensions will take place on a new principle, all pensions will be indexed. He noted that in 2024 the size of the average pension will be increased to UAH 6,000.
In March 2023, the Cabinet indexed pensions by 20%.
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