Pension indexation for working retirees

At present, both current and future pensioners are of great interest to the question concerning not only the pension reform under discussion, but also whether pension indexation will be carried out for working pensioners. This topic is being raised both at the philistine and at the state level, and this is not the first year. But this year, the topic began to be vigorously discussed in connection with the bill on possible pension reform.

What is pension indexation?

Under the concept of indexation means an increase in the amount of pensions for a certain amount, carried out due to rising prices for consumer and other goods. In addition to pension payments, the minimum salaries, scholarships and other social benefits are subject to recalculation in the same way.

Similar events are carried out on the basis of the law on state. pension provision in Russia No. 166-ФЗ adopted on December 15, 2001. According to the law, the procedure occurs on the first day of the following month after the new price index for main products is officially published. There is no single date for indexing pensions to former working pensioners or unemployed from the moment they go on a well-deserved rest when they reach the appropriate age. Therefore, the authorities choose and declare a certain number when the next changes will be carried out independently.

When indexing a pension, the size of benefits related to:

• Allowances.
• Additional funds.
• Supplements to social assistance.

The next increase in pension payments is affected by previous increases, the dates when the relevant decisions were made and, of course, the status of a citizen (that is, whether he is working or not, disabled person, military man, and so on).

Indexing pensions earlier and today

This recalculation was carried out earlier in relation to all pensioners: working and non-working. However, since the beginning of 2016, the indexation of pensions for older workers has been discontinued. Rather, the government announced the so-called “freezing” of this operation, explaining this by the difficult financial situation in the country. This situation was valid in 2016, 2017 and this year.

However, last year pensioners were mitigated by the “bitter pill” with a lump sum payment of 5 thousand rubles. It was produced in January 2017 for older people (regardless of whether they continued to work or not). In 2018, pensioners also expected similar support from the state. But there was no such payment. Therefore, they continue to hope not only that indexation of pensions will be carried out for former working pensioners, but also that it will also be restored to working pensioners.

Pensions for working and non-working pensioners: differences in amounts

Until the indexation of pensions to working pensioners was canceled, the increase in payment was carried out by:

• Indexation of retirement points, as well as a fixed part of the pension.
• Increase in the number of points for the previous year of work.
• Deductions of the funded part of the payment.

But after the suspension of indexation, the increase in the amount began to be ensured only by increasing the IPC. If the pension is issued before the cancellation of indexation, then recalculation is made for the amount that was accrued at the beginning of 2016. The following table will help you compare the changes in the amounts of working and non-working pensioners.

As can be seen from the table, indexation alone, in relation to payments to non-working pensioners, will increase the amount by 3222 rubles, while the pension of a peer who will continue to work will increase by only 857 rubles. (since the indexation of pensions to working pensioners in 2018 and 2019, as well as in 2016 and 2017, has not been and is not planned to be carried out).

Nevertheless, after leaving the pensioner, a recalculation will be made, which will take into account the missing indexations. As a result, due to the accumulated points during the continuation of a person’s retirement work, his payout will increase compared to the pensioner who immediately went on a well-deserved rest after the appropriate age.

Discussions on the indexation of pensions in the State Duma

Since the indexation of pensions to working pensioners has been suspended, proposals have been repeatedly submitted to the State Duma to resume the relevant payments. This was caused both by injustice in relation to these citizens, and by the economic groundlessness of this event. The fact is that initially the abolition of indexation pursued a purely economic interest: the government thus hoped to save money on working retirees. However, soon the elderly people sorted out what was happening and found the best option how to get out of the situation without losing money.

Some really quit their jobs, but many simply moved to the so-called “gray zone” and continued to work without proper clearance. As a result, the number of working pensioners decreased from 15,259,000 to 9,600,000. Therefore, the economy expected by the state never happened. Rather, on the contrary, this measure led to losses.

Also in the spring of 2018, Bill No. 362896-7 on the abolition of indexation was sent to the State Duma for consideration. But after registration, he was postponed indefinitely.

07/01/2018 the same bill was put forward by the Liberal Democratic Party. Party members also said that the adoption of these measures adversely affected the financial situation of pensioners. At the same time, the number of officially working pensioners has significantly decreased, since working part-time through unofficial means has proved more profitable. But this bill was also canceled with the note that there was not enough public money to carry out the measures stipulated by the bill.

Thus, none of the proposals was approved.

Recalculation to working pensioners in the current year

Despite the fact that pension indexation is not carried out for working pensioners in 2018, their payments will continue to increase slightly. This is done through recalculation, which is carried out every year and is based on pension points that a pensioner earned a year earlier. At the same time, a limiting coefficient of 3 points is provided. That is, if a pensioner has earned more points, then the corresponding amount equivalent to this amount will go to next year.

In 2017, the cost of each point was 78 rubles. 58 cop. Therefore, the maximum allowance that a working pensioner could count on this year was 235.74 rubles.

The meeting of V.V. Putin with M.V. Shmakov in 2018

At the next meeting of the president with the head of the Federation of Independent Trade Unions M.V. Shmakov, held in April 2018, the question of whether the indexation of pensions for working pensioners will be returned in the near future or not was discussed. After the conversation, Vladimir Putin instructed the government to re-examine the problem and the possibility of lifting the freeze.

The issue was considered along with the possibility of introducing pension reform. But the government did not return indexation to working pensioners and did not cancel the freeze. When the current Minister of Finance of the Russian Federation A. G. made his messageSiluanov, he dispelled all the hopes of the elderly and gave a negative answer to the question of whether there will be pension indexation for pensioners working in 2018. He bluntly stated that until 2020, the freezing of indexation of payments will not be abolished. Only in the future is a return to this issue possible. At the same time, this problem receded into the background when a draft law on the implementation of pension reform arose.

Pension reform

It is assumed that the sensational pension reform will begin to operate from the beginning of 2019. Thanks to her, part of the money will be directed to support people who have already reached the appropriate age.

An increase in this age is planned to be carried out gradually. As a result of this event, it was planned to make men retire only at sixty-five years old, and women at sixty-three years old. The reform should be completed by 2028 for men, and for women by 2034. With an interval in a year the increase will be carried out for one year. However, during a public statement, Vladimir Putin proposed reducing the increase in the retirement age of women from sixty-three to sixty. Therefore, today it is planned to complete the pension reform for men and women in the same period: by 2028.

The government insists that the meaning of the pension reform is to free up budgetary funds through a later retirement and the appropriate processing of payments. With this in mind, already in 2019, the addition to the existing pension will amount to 1 thousand rubles each year and as a whole for the year will amount to 12 thousand rubles.

How pension reform will affect payments

According to forecasts of the Ministry of Economic Development, the increase in prices for basic goods in the coming years will have the following marks:

• In 2019 - 4.3%.
• In 2020 - 3.8%.
• In 2021 - 4%.

In the FIU, it is planned to increase old-age pension payments as follows:

• In 2019 - by 7.05%.
• In 2020 - by 6.6%.
• In 2021 - by 6.3%.

In accordance with Art. 18 of the law on labor pensions - ФЗ-№400 dated 12.28.2013, - the change in the value of insurance pensions is carried out on February 1. The increase in social benefits, as well as indexing for non-working pensioners, is carried out a little later - on April 1.

If the above percentage of indexation is approved by law, the main components of the payment will be as follows:

• An individual pension coefficient (or IPC) will amount to 87.24 rubles.
• Fixed pension - 5,334 rubles.

As the Chairman of the Accounts Chamber T. Golikova clarified this issue, the increase in payment will be carried out in two stages. On February 1, the size of the pension will increase by 4% due to inflation, and then, on April 1, by another 2.4%, due to savings. Previously, pensions increased only in connection with an increase in prices for basic products. As a result of the innovation, both the fixed part of the pension and the IPC will grow.

The growth of social pensions increases by that indicator, which is approved by the next Decree on indexation. This year, the payment increased by 2.9%, that is, by 255 rubles. The following changes are projected in the coming years:

• In 2019 - 0.4%.
• In 2020 - 2.9%.
• In 2021 - 2%.

If these forecasts are confirmed, then in numbers the following values ​​will be obtained:

• In old age, as well as for disabled people of 2 groups - 5,200.96 rubles.
• Children with disabilities - 12,482.17 rubles.
• Disabled people of the 1st group - 10,401.96 rubles.
• Disabled people of 2 groups - 4,420.85 rubles.

Along with raising the pension, an indexation will be carried out for an approximate amount of one thousand rubles. The period for the end of allowances to pensioners has not yet been appointed. Due to the fact that in 2019 the average pension will increase by one thousand rubles, for a calendar year it will be approximately 14,400 rubles. Next year, the average value will reach 15,367 rubles. That is, the premium will be approximately 1,067 rubles.It is estimated that by 2024 this pension indicator will increase to approximately 20,000 rubles.

Increased military pensions

According to Tatyana Shevtsova, Deputy Minister of Defense of the Russian Federation, the military will also expect a significant increase in pensions. If from 01.01.2018 they were increased by 4%, then by 2020 the size will increase by 12%.

At the same time, the decreasing coefficient was frozen at 72.23% until 2020. It is assumed that this will help to increase the real value of payments in order to provide the military with decent living in old age. This coefficient was introduced as early as January 1, 2012 in order to keep pensions at the same level without increasing them along with the salary of military personnel. Thus, the question of the indexation of pensions by a working military is not raised: they will have a decent retirement life without them.

Entrance to a well-deserved rest next year

The retirement conditions for men during this period will be as follows:

• Reaching sixty years.
• Presence of work experience of ten years.
• Accumulation from 16.2 IPC.

The retirement conditions for women are as follows:

• Achieving fifty-five years.
• The number of accumulated points from 16.2.
• Work experience - from ten years.

Privileges for retirement this year will remain with men born in 1958, and women with 1963. Regardless of whether the bill under discussion will be approved or not, they will receive the due payments of 60 years and 55 years, respectively.

Thus, the first to be affected by a possible reform will be men born in 1959. and women born in 1964 They will go on a well-deserved rest in 2020 when they reach 61 years and 56 years respectively. At the same time, there are a number of categories of citizens whom the future pension reform will not affect.

If, by the indicated period, older people were unable to meet even the minimum parameters stipulated for receiving the insurance part of the old-age pension payment, then men will have to wait for the corresponding income before reaching 70 years (and not 68 years old, as it was before), and women - 65 years (and not 60 years, as was done earlier). If a person has a disability, then he will be able to apply for a pension at any age. But the indexation of pensions for working disabled people will not be carried out, as well as for other persons who have reached advanced age, but continue to work.

Payments indexation for working retirees next year

Indexation of pensions for working retirees after 2018, as before, is not expected. As mentioned above, this was reported by Anton Siluanov 06/25/2018. He explained this decision by the fact that the economic situation is gradually stabilizing, and citizens' incomes are increasing, including the category of working pensioners. Therefore, they are supposed to be fine without indexing.

Thus, that substantial allowance, the average amount of which in 2019 will amount to one thousand rubles, will not affect pensioners who continue to work. The only way to increase the size of payments is not the expected indexation of pensions in 2018 to working pensioners, but recalculation, which is carried out annually in August. In this case, the amounts transferred by the employer to the Pension Fund in the previous year are taken into account. But even as a result of this operation, no working pensioners can count on a substantial increase. The reason lies in the limitation of points earned, which are counted in the next year. At present, only 3 pension points can be taken into account in the calculation.

For recalculation, working pensioners do not need to additionally apply to the PFR office at the place of residence with a corresponding application. The operation is carried out without it. The cost of pension points is calculated without taking into account inflation indicators. The fixed payout will also remain the same. Thus, the growth of this amount is not considered when calculating a new pension payment.

For non-working pensioners, such recalculation is not done. This is due to the fact that they do not receive any payments to the Pension Fund, which means that pension points are not awarded.

All of the above does not mean at all that a working pensioner will forever remain in this position. The indexation of pensions to a working pensioner upon dismissal will nevertheless be made. At the same time, all the missing indexations will be taken into account, starting in 2016, namely: the full amount of pension provision will be accrued, and the indicators affecting its size (number of pension points, their cost, amount of the fixed part of the payment) will increase.

In addition, this is not the last indexation of pensions for working pensioners. In the future, their payments will be subject to annual indexation along with payments to pensioners who are not currently working. Therefore, for the operation to be carried out, pensioners should quit their jobs. Many of them have found a way out of this situation by resigning specifically in order for the pension to be indexed. After that, they again get a job (often in the same place and the same position).

The peculiarity in this case is that the indexation of the pension after the dismissal of a working pensioner cannot be canceled in the future if he decides to continue working again. This is used by those elderly people who have learned to interact with government agencies in the most advantageous form for themselves.

After a person leaves, there is a difficult procedure for processing documents, which also considers what indexation of pensions to working pensioners should be accrued after dismissal. As a rule, it lasts about three months. That is, a pensioner begins to receive a recalculated pension only after three months after leaving work. A logical question arises as to whether this period will be taken into account in the calculation. The legislator unequivocally answers positively to this. The calculation is made directly from the date when the pensioner officially resigned, even though he received real money in the account a little later.

Conclusion

Unfortunately, pensioners will have to be upset by answering the question of whether there will be pension indexation for older people working in 2018. Neither in the present, nor in the coming years, this will happen. However, in the future the situation may change, as well as in relation to the pension reform, which Russia was drawn into. The indexation of pensions for working retirees is likely to recover after 2020. But at the moment, this category of citizens can only count on 3 pension points annually, which as a result will give only a small allowance. At the same time, despite the fact that indexation of pensions is not carried out for working pensioners in 2018, they have found ways out of the situation that are advantageous for themselves.