Experts have revealed the secrets of social payments for the next three years
We can talk more or less confidently today about what payments and indexation await pensioners in the next three years. After all, right now, simultaneously with the draft federal budget for 2024-26, the budget of the Pension and Social Insurance Fund of the Russian Federation for the same period is being considered and approved. Based on the figures contained there, all future indexations of payments to Russian pensioners will be carried out. And the numbers there, as it turns out upon detailed examination and analysis, contain extremely interesting and non-standard ones. For example, as follows from the conclusion of the Accounts Chamber of the Russian Federation on the draft budget, Russian elderly people will face two double indexations of pensions — in 2025 and 2026. What caused this and how much pension payments would increase as a result, MK figured out with the help of experts.
The authorities plan to index the insurance pensions of non-working pensioners twice a year in the next two years. In 2025, pension payments will first increase by 4.5%, and then by another 2.2%. In 2026, indexation will be 4% for the first time, and 2.3% for the second time. Thus, the average annual pension by 2026 could increase to 25,590 rubles, says the Accounts Chamber in its conclusion on the draft Federal Law “On the budget of the Pension and Social Insurance Fund of the Russian Federation for 2024 and for the planning period of 2025 and 2026.” Earlier, Deputy Prime Minister of the Russian Federation Tatyana Golikova recalled that 2024 will be the last year when pensions should be indexed to the equivalent of 1,000 rubles. This corresponds to a 4.6% increase in pension payments. “Currently the increase in pensions is 7.5%. We did this based on the forecast inflation rate. Starting from 2025, as provided by law, we will return to indexing pensions twice a year: from February 1 according to the actual inflation of the past year and from April 1 according to the growth rate of the wage fund,” said the Deputy Prime Minister.
< p>The other day, Russian Finance Minister Anton Siluanov announced that after indexation by 7.5% in 2024, the average pension for non-working pensioners could be 23,405 rubles. In 2025, the average annual insurance pension of a non-working pensioner is expected to be 24,330 rubles.
The average annual number of pensioners in 2024 will be about 43.51 million people. By 2026, their number will be reduced to 43.32 million people, the Accounts Chamber noted.
What is the reason for the upcoming double indexation of pensions, how exactly will it be implemented, what amounts can Russian pensioners expect as a result? We addressed all these questions to experts — economists, specialists in social issues.
“The purpose of the innovation is to more accurately and flexibly compensate non-working pensioners for price increases. And strive to even exceed the official inflation rate. In 2024, according to the draft budget of the Social Fund, indexation could be 7.5%, in accordance with the expected inflation rate in 2023. In this case, the average pension will slightly exceed 23,400 rubles.
And starting next year, 2025, they will take into account not only last year’s price increases, but also the increase in contributions to the Social Fund from workers’ salaries. Therefore, the first payment is based on the inflation of the previous year, which is projected to be 4.5% for 2024 and 4% for 2025. And the second payment is shifted in time by two months — to April 1. As a result, pensioners will be able to receive an additional increase, but depending on the increase in the income of workers and their payments to the Social Fund. And the average rate of increase in wages is expected to be higher than that of pensions. And the ratio of insurance pensions to wages in the country will decrease. In 2024 it will be 26.5%, in 2025 – 25.8%, and in 2026 – 25.3%. On the one hand, this is a certain negative. In economics, it is considered optimal when pensions amount to up to 35-40% of an employee’s previous salary. But on the other hand, it is precisely the outpacing of current wages that will make it possible to pay the April increase in pensions. And this can give pensioners an increase in their income above inflation.
But at the same time, according to calculations of the Social Fund budget, the excess of the insurance pension to the level of the pensioner’s subsistence level will be reduced. This excess will be 75.4% in 2024; in 2025 – 67%; in 2026 – 59.5%. Thus, the rise in prices for the minimum necessary goods and services for pensioners is expected to be stronger than general inflation. For pensioners with low incomes, compensation may still not reach the level of price increases.»
“Such steps by the authorities to double indexation of pensions are explained by three groups of reasons. Firstly, this is inflation and the purchasing power of the population. Russia, like many other countries, is faced with a noticeable increase in prices for goods and services. Indexation of pensions makes it possible to compensate for losses in the purchasing power of pensioners, which justifies this decision.
Secondly, the standard of living of pensioners. Increasing pensions will have a positive impact on the quality of life of non-working pensioners. Many retirees face financial difficulties and limited options to improve their standard of living. Double indexation can at least partially help increase income and provide more comfortable living conditions. In addition, such indexation can help strengthen social stability, which is important for the development of the country and society.
Thirdly, the financial sustainability of the budget. However, it should be borne in mind that such indexation of pensions may create an additional burden on the federal budget. Therefore, relevant departments and the Cabinet of Ministers need to carefully plan expenses and consider measures to ensure financial sustainability in general.”