KIEV, April 4. /TASS/. The law on pension reform should be adopted by the Ukrainian Parliament by the end of April 2017 and to take effect from the beginning of 2018. This is stated in the published text of the Memorandum on economic and financial policies between Ukraine and IMF.
“Pension reform has proved a complex and multi-tasking area of reform, but with heightened urgency, the authorities are preparing a new pension law with the assistance of the world Bank in order to obtain parliamentary approval by the end of April 2017. This reform is intended to Finance pension funds have strengthened their position on a sustainable basis and create opportunities to raise pensions by increasing the effective retirement age,” – said in the text of the Memorandum.
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Reform should include a new list of options retirement with a broader range of retirement age compared to the existing ones. Every citizen should be offered a choice of time and conditions of retirement, which in turn depend on the General seniority.
In addition, it is necessary to introduce additional pension benefits to encourage longer employment of citizens and later their retirement.
According to the Memorandum, the reform should promote savings of at least 3% of GDP in the long run, including by increasing seniority at retirement.
“Not a single” word on the age
Earlier, Prime Minister of Ukraine Volodymyr Groisman stated that a new Memorandum of cooperation between Kyiv and the International monetary Fund would not involve raising the retirement age in Ukraine. He argued that the Memorandum “is not a single word about raising the retirement age for Ukrainians.”
According to him, this year the government intends to increase the pensions. Groisman also said that one of the tasks is the elimination of the deficit of the Pension Fund, which currently stands at about 140 billion hryvnia ($5,19 billion at current exchange rates).
IMF assistance to Ukraine
In March 2015, the IMF opened a four-year loan program for Ukraine at $17 billion, which included quarterly review and allocation in 2015-2016 eight tranches. Previously, Ukraine has already received three of them: $5 billion, $1.7 billion and $1 billion on the Eve of the IMF Board of Directors decided to grant Ukraine another $1 billion in the framework of macro-financial assistance. These funds, the national Bank expects to receive “in the coming days.”