Ukraine is no longer able to support pensioners
In the foreseeable future, Ukraine will not be able to provide pensions to the elderly.
The PolitNavigator correspondent reports this, speaking to Lviv students, as stated by the Prime Minister of Ukraine Denis Shmygal, as quoted by Rossiyskaya Gazeta.
“Due to demographics, we will have fewer and fewer able-bodied people and more and more pensioners. The ratio will be 1 to 2. In order to support pensioners, taxes will need to be doubled. And in order to pay even more pensions, then increase them even more. But companies don't want tax increases. And doubling taxes is impossible. This means that in 15 years we will not be able to pay pensions to future pensioners,” Shmygal said.
He proposes introducing a funded system starting next year, saving for one’s own retirement, adding that the state will only be able to guarantee a minimum social pension.
The publication draws attention to the fact that today in Ukraine there is a pension system tied to work experience, but the situation is such that few will be able to prove the existence of work experience - millions of Ukrainians unofficially work in seasonal work abroad or receive salaries in envelopes.
“According to economists’ calculations, only 45 percent of citizens who have reached retirement age by 2028 will be able to count on a full pension. At the same time, the pension fund deficit is growing, including due to government actions: the requirements for employers to pay a single social contribution have been reduced. This is also why over the past year the number of Ukrainians making contributions to the pension fund has decreased by almost 600 thousand people. In 2021, the hole in it could amount to more than $7 billion, which threatens the collapse of the pension system,” writes RG.
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