MainPolitical

Pension Fund deficit seen as weak point of Ukraine's draft budget

Any attempt to increase the subsistence minimum will affect pension payments.

Pension Fund deficit seen as weak point of Ukraine's draft budget
Photo: NBU press service

The imbalance of the Pension Fund is a weak point of the 2019 draft budget, journalist Ulyana Yakhno says in an article for LB.ua. (in Russian).

"Any attempt to increase the subsistence minimum for the disabled will instantly affect pension payments, which already make up the second largest budget expenditure item after paying off the national debt," she says.

The share of state budget funds in the Pension Fund’s budget is constantly increasing. In 2019, it should reach 42%.

However, the issue of the Pension Fund’s repayment of loans from the treasury to cover up temporary cash gaps has not been legally settled yet.

The debt has begun to grow rapidly and reached 11.5bn hryvnyas (more than $70bn) since the beginning of the year.

Yakhno noted that social standards projected by the Finance Ministry in the draft budget are lower than those of the Social Policy Ministry.

In particular, the Finance Ministry expects the subsistence minimum to make 2,102 hryvnyas for able-bodied people and 1,638 hryvnyas for the disabled on 1 December 2019.

This is at strong variance with the Social Policy Ministry's statement that in August 2018 was 3,331 hryvnyas for the able-bodied and 2,710 hryvnyas for the disabled.

In summer 2018, the Pension Fund delayed the payment of pensions by seven to 10 days.

Andrii Ianitskyi Andrii Ianitskyi , ​Business editor at LB.ua
Read LB.ua news on social networks Facebook and Twitter