Socio-economic prerequisites for increasing retirement age in Ukraine

  • Natalia Martynenko Kharkiv Regional Institute of Public Administration of the National Academy of Public Administration the Office of the President of Ukraine https://orcid.org/0000-0002-3234-0689
Keywords: pension provision, joint pension system, aging of the population, aging of the populationload on the pension system, load on the pension system, actuarial modeling, demography, macroeconomics

Abstract

The article substantiates the need to increase the retirement age in the context of reforming the pension system of Ukraine. Arguments are presented that the process of raising the retirement age should be scientifically sound, have a long-term nature, and proceed gradually. It is noted that increasing the retirement age will have positive effects both for the pension system in particular and for the economic system of Ukraine as a whole, including: 1) a decrease in the financial dependence of the pension system on budget transfers; 2) ensuring a socially acceptable level of pensions; 3) preventing the growth of the insurance burden on the business; 4) compensation for the demographically determined reduction in the economically active population, stabilization of the labor market; 5) promoting active longevity. It is proved that the main arguments against raising the retirement age are for the most part not sufficiently substantiated. The adoption of appropriate amendments to the current legislation regarding raising the retirement age to 65 must be carried out by adopting the law "On adapting the retirement age to demographic changes in society".The solution to the strategic problem - the long-term balance and stability of the pension system can be achieved only by implementing an integrated approach to pension reform, which is not limited to one parameter, no matter how important it is. It is necessary to carry out long-overdue transformations in the labor market, in demographic policy, economy and social sphere, which would help create real conditions for citizens to earn a decent level of pension and fully realize their rights to receive it.It is proved that in order to avoid the short-term effect of raising the retirement age and further increasing the cost of paying pensions due to the increase in the number of recipients with an increased amount of pension rights due to an additional period of seniority, it is necessary to carry out actuarial calculations that allow us to formulate practical proposals to mitigate the negative economic consequences.

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Published
2020-02-29
How to Cite
Martynenko, N. (2020). Socio-economic prerequisites for increasing retirement age in Ukraine. Public Administration Aspects, 8(1), 106-116. https://doi.org/10.15421/152011
Section
Article