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No need to raise retirement age in Russia until 2050 – MP

March 25, 2013, 21:12 UTC+3

Minister of Labour and Social Security said that the idea of raising the retirement age in the country would lead nowhere

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MOSCOW, March 25 (Itar-Tass) – There will be no need to raise the retirement age in Russia until 2050, Valery Ryazansky, chairman of the Federation Council Committee on Social Policy, said on Monday, March 25.

“We have set such a regime for ourselves and experts who are working on the [pension] formula that the question of retirement age is not on the agenda,” he said.

“All calculations have been made in such a way that we will not consider this issue in principle until 2030 or even 2050,” Ryazansky said.

Yuri Gorlin, Deputy Director of the Institute of Social Analysis and Forecasting, said a new pension formula will raise the pension considerably and its size will grow further if a person retires late.

The new formula will increase the pension considerably depending on the seniority record and incentivise people to work longer after the retirement age. “Calculations show that if [a man] retires not at the age of 60 but at the age of 65, his pension will grow to 85 percent,” Gorlin said.

“If we talk about the average pension, if the length of service is 35 years, the pension in the prices of 2015 will be about 16,000-16,500 roubles, provided a person retires at the official retirement age. If he retires five years later, it will be about 23,000 roubles,” the expert said.

The average pension in Russia now is 10,400 roubles.

The new pension formula is expected to be adopted this summer.

The Russian authorities have repeatedly stated that the pension reform would not lead to the raising of the retirement age.

Minister of Labour and Social Security Maxim Topilin said that the idea of raising the retirement age in the country would lead nowhere and would fail to balance the Pension Fund’s budget.

“The demographic situation is such that there is no prospect or need to raise the retirement age,” he said.

“There is a popular belief that if the retirement age is raised, the Pension Fund deficit will decrease. But it will not,” the minister said.

“If you raise the retirement age, you will pay [pensions] for a shorter period of time, but the amount of obligations under the pension formula will not become smaller,” he said.

Raising the retirement age in Russia would be unacceptable and unnecessary, Vladimir Putin said earlier before his inauguration.

“This is ruled out. If we did this, the retirement age in the country would be 65 years already now for both men and women. We understand that this is unacceptable and unnecessary for Russia now,” Putin said.

Putin said pensioners who wish to work after retirement should be allowed to do so.

“I want to stress once again that we have no plans to raise the retirement age. But those who wish to continue working after reaching the retirement agent and want to preserve a good income -- we must create additional conditions for them to earn a better pension,” Putin said.

In his view, good economic stimuli should be created for that but warned that they “must not be imposed but should be stated and offered”.

Putin said that the overall size of pensions will also grow. “We will not allow pensioners to fall into poverty again as before, all of them without exception,” he said.

He promised that all socially vulnerable sections of the population that need help from the government would get all the necessary conditions for decent life and self-realisation.

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