REFORMING THE PENSION SYSTEM OF UKRAINE

Visnyk LNAU: Economics of AIC 2018 №25: 168-171

REFORMING THE PENSION SYSTEM OF UKRAINE

Grytsyna О., Candidate of Economic Sciences
Sholudko О., Senior Lecturer
Lviv National Agrarian University

https://doi.org/10.31734/economics2018.25.168

Annotation

Social protection of citizens is one of the most important functions of the state, the essence of which is to reduce the risks associated with disability, unemployment and the achievement of retirement age. One of the varieties of social protection is retirement and pension insurance, the main tasks of which are to support the viability of citizens who have reached the elderly, which can not provide them with a minimum income level.

The study of pension provision in Ukraine suggests that the existing pension system does not fulfill its functions, since pensions in most cases do not allow maintaining the level of viability even at the minimum level. Reform of the pension system of Ukraine began in 2003. However, the three-tier pension system is formed only formally, revenues and expenditures of the Pension Fund are unbalanced, the number of contributors of insurance premiums decreases with the simultaneous increase in the number of retirement age persons. The pension reform stipulates that, alongside and at the level of the joint-stock company, a compulsory pension insurance system in Ukraine should function. Participation in the second level will be mandatory for all insured persons who pay contributions to the joint system, most likely, will introduce age requirements for participants, as older people will not be able to accumulate sufficient funds for the purpose of granting pensions.

Article 1 of the Law «On Measures for Legislative Support of the Reform of the Pension System» stipulates that only those persons who, at the date of the introduction of the transfer of insurance premiums, are not more than 35 years old, will be participants, and those who remained less than 10 years before January 1, 2019 reaching the retirement age, have the right to make a decision not to levy insurance premiums to the accumulation system of pension insurance.

Key words

pension provision, pension system, pension reform

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Link

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