REGARDING THE TOPICAL QUESTIONS OF MODERNIZATION (RECALCULATION) OF PENSIONS

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REGARDING THE TOPICAL QUESTIONS OF MODERNIZATION (RECALCULATION) OF PENSIONS

Journal Title: «Приватне та публічне право» - Year 2018, Vol 1, Issue

Abstract

Reforming the pension system today is one of the main directions for improving the overall system of social protection of population in Ukraine. Placing importance on pension system and such necessity is determined by lots of factors, namely the formation and development of a market economy, the process of formation of a social state, the need for an adequate response to the demographic situation in the country (population ageing). It cannot be assumed that the Law of Ukraine “On Amendments to Certain Legislative Acts of Ukraine Regarding Increasing Pensions” is a pension reform as such. The reform proposed by the Government, in its essence and spirit, cannot be considered a reform, as far as the pension system in general has not changed, it remains solidary. The changes in the pension sector introduced in 2017 will affect every citizen – both those who are already on a well-deserved rest and those who are still working, but in the future expect to receive a decent pension. Therefore, the question of pension provision is actively debated today in the Government, as well as among scientific community and ordinary citizens. One of the important and main components of the pension reform in 2017 was the mandatory updating of pensions that is recalculation thereof according to the growth of the average salary. Thanks to the modernization of pensions, justice should be restored to all those citizens who have been working their entire lives and earned decent pensions for their work. The pension reform aiming at modernization of pensions consists of two parts: the modernization of pensions for current pensioners and for future pensioners. After entry of the Law of Ukraine “On Amendments to Certain Legislative Acts of Ukraine on Increasing Pensions” into force, the amount of pension increases is calculated individually for each pensioner depending on his earnings, which he received during his employment, and his length of service. However, according to the first results of pension modernization, the size of pension supplements depends not only on the length of service, but on the salary amount received during employment. Improvement of the conditions of pension protection of modern pensioners in accordance with the new law does not provide for fundamental changes in legislation for future pensioners as well. The system of formation and use of pension system finances, the mechanism for administering this system needs to be improved. This fact, in turn, causes the necessity of creating the appropriate legal basis for the new pension system. Pension reform in Ukraine should achieve the following targets: to establish the dependence of the size of pensions on the amount of earnings and length of service; to encourage citizens to save money against old age; to create an effective and efficient system of administrative management in pension protection; to ensure the financial stability of the pension system; to ensure the reliability of the savings of pension program participants; to raise the living standards of pensioners; the pension reform should be an integral part of formation of the social insurance system. Changes in the pension system have already become reality, but not within the framework of the reform, but within the framework of modernizing pension payments and changes in conditions of new pensions granting.

Authors and Affiliations

В. С. Тарасенко, Л. І. Харитонова

Keywords

EP ID EP589490
DOI -
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