Putin: pensions to be increased by 6%-7%

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Putin: pensions to be increased by 6%-7%

By prime-tass agency staff

The Russia Journal Daily, Apr 04, 2003

TAMBOV - To ensure timely wage payments to state employees it is necessary for regional budgets to allocate no less than 40% of their revenues for that purpose as the government recommends, Russian President Vladimir Putin told reporters late Wednesday.

Putin said that currently 63 out of Russia’s 89 regions do not have any wage arrears to state employees.

This, Putin said, testifies to the fact that there are either no contradictions between governors and municipalities or they are not being resolved at the expense of the people.

Speaking on the issue of pensions Putin said that it is possible that pensions will be raised once again in addition to the index-linked increase planned for August.

He said that from August 1 pensions are planned to be increased by 6%-7%, which, coupled with the April 1 index-linked rise, will result in an average monthly increase of 265 rubles this year.

Putin also said that taking into account new amendments to the pension law, the law “has turned out to be a good one” because it provides government guarantees on the insurance part of pensions, which may otherwise be lost.

Russia uses two systems to make pension payments: the base pension does not depend on past contributions, while the insurance pension is paid from current contributions and has a limited dependence on the past contributions of the pensioner. (31.2860 rubles – U.S. $1)