The pension reform does not reduce benefits for current pensioners, but it is one of the most sensitive reforms, since it concerns 11 million existing pensioners and at least the same number of future ones.
Vitalii Lomakovych, the Founder and Chairperson of the Board of the Growford Institute, spoke about this in Reform Time with Svitlana Mialyk live on Ukrainian Radio.
“We are talking about the fact that people who have not yet reached retirement age will get the opportunity to save for their pension. The state will provide a mandatory state pension within the subsistence level. Many people have fears and distrust that the accumulated pension money could be “eaten away” by inflation. But this will not happen. Why? Pension reform involves the creation of a special institution – an asset management company. I hope that this will not be a state institution and companies with experience in the market and appropriate licenses will organize it. They will create added value for pension savings, i.e. they will generate income on the accumulated money. Ideally, this income should exceed the level of inflation,” he explained.