Minister of Social Policy of Ukraine Yulia Sokolovska says that in the short term a funded pension system won’t be introduced in Ukraine.
“In the short term, it is unlikely. We do not have the infrastructure created to make it work, but there are already many developments. In general, studies on the funded system show that public expectations for this system are too high, people do not fully understand how much funds will be,” Sokolovska said in an exclusive interview with Kyiv-based Interfax-Ukraine new agency, asked whether the funded pension system will be introduced in Ukraine in the near future.
According to the minister, for the introduction of the funded system, we first need to create its design, namely: who will pay contributions, how much interest they will be, make actuarial calculations, whether it will be beneficial to the person.
“The advantage of accumulation is ‘long’ money, that is, savings. Usually it works so that the funds are invested, which means there should be a market where you can invest. Today there is practically no such market in Ukraine. You know that the bill on ‘split’ was adopted – it also contains the issues of regulation of non-state pension funds, the National Commission for Securities and the Stock Market. These are the first steps and here we can say, if we move in this direction efficiently, in what period of time we will be able to introduce the funded system,” she said.
Sokolovska also noted that it is necessary to look at the experience of other countries in order to adopt only the best practices.
