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  #301  
Old 07-11-2018, 03:19 PM
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SOUTH KOREA

http://www.businesskorea.co.kr/news/...ml?idxno=23557

Quote:
NPS Suffering from a Worsening Investment Staff Exodus
Spoiler:
The National Pension Service (NPS) has been operating without the chief officer of national pension fund management for a year.
....
The National Pension Service (NPS), the world's third-largest pension fund which oversees 630 trillion won (US$566.29 billion) of South Korea’s public pension assets, is now facing a crisis. There are even growing concerns that the pension fund can be disassembled, with an increasing number of employees leaving the company. Since there are not enough employees investing, the NPS shows poor earnings rates.

The “investment staff exodus” from NPS is largely because its new office was relocated far from Seoul last year and the NPS has been operating without the chief officer in charge of managing national pension fund assets for a year. The position of overseas alternative investment chief has been vacant for a year and five months and chief officer of stock investment has been recently dismissed from the post. Cho In-sik, head of overseas securities, who has served as the acting chief officer of national pension fund management, has tendered his resignation. In regard to asset management, four out of seven positions for directors and coaches who have a primary responsibility have been operated with patch-up.

This also triggered exodus of hands-on investment officers. Right before its new office was relocated to the provincial city of Jeonju, 30 employees handed in their resignation in 2016, 27 in 2017 and 10 this year. The number of investment employees at the NPS decreased from 274 to 242 at the end of June.

The government is also aware of the problems. When the Ministry of Strategy and Finance announced the fund evaluation results in May, it pointed out, “The NPS should raise expertise of the investment team and come up with measures to prevent workforce exodus that has occurred after the shift to Jeonju.”


Given the current situation, it is only natural that the NPS earnings rates have deteriorated. According to the NPS, its earnings rate stood at -0.21 percent in the first quarter this year. It even lost the principal. Its average rate of returns in the past five years also came to 5.81 percent, less than half the rate of the world’s top six pension funds such as Canada with 12.24 percent, and the Netherlands and Norway with 9.32 percent and the United States with 9.16 percent. Its earnings rate last year was 7.28 percent, reaching a five-year high, but it still fell short of the Government Employees Pension Service with 8.8 percent and the Korea Teachers Pension with 9.2 percent over the same period.
.....
Since the NPS doesn’t have enough labor pool, it has a low percentage of overseas securities and alternative investment. Currently, the NPS’ share of home investment exceeds 70 percent. As of the end of last year, the NPS could exercise its voting rights in more than 770 South Korean companies and had over 5 percent of stake in 300 companies. This is why the NPS is criticized as a “whale in a pond.”

The NPS should first expand investment in overseas securities and alternative investment further in order to delay pension exhaustion as much as possible. Currently, the NPS has a 50 percent share of bond investment. The California Public Employees' Retirement System in the US invests only 19 percent of capital in bonds and the remaining in stocks and actual assets. The Netherlands’ public funds also invests 30 percent of its assets in bonds and the remaining in stocks and alternative investment.

The NPS also needs to dramatically increase investment in overseas assets from the current 20 percent. Japan’s Government Pension Investment Fund invests 40 percent of its funds in overseas assets, while Canada Pension Plan Investment Board invests 80 percent. A head of the pension and funds management division at a securities firm said, “The government should give independence and autonomy to the NPS and stop making an attempt to drag NPS’ savings into political business.”
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  #302  
Old 07-15-2018, 08:40 PM
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IRELAND
DIVESTMENT

http://ipfiusa.org/2018/07/13/ipfi-r...nts-from-ipfi/

Quote:
IPFI Responds to Irish Divestment – IPFIUSA

Spoiler:
On July 12 it was reported that the government of*The Republic of Ireland*would become the first country in the world to sell off its investments in fossil fuel companies. The divestment bill passed through the lower house of parliament with all-party support and will require the $9.3 billion*National Investment Fund to sell its investments in coal, oil, gas and peat “as soon as is practicable.” This divestment action, one that will cost the government of*Ireland millions in frictional costs and re-investment fees, came at the behest of an environmental movement aimed at decreasing the financial position of major fossil fuel companies. This type of action is unacceptable to IPFI and our President Christopher Burnham. Political decisions such as this one do not put the needs of the fund at the forefront of decision-making.
The Republic of Ireland ranked recently as the*second worst European county for climate action. This ranking undoubtedly drove leadership to make this hasty and ill-informed decision. The divestment action is being heralded as a blow to fossil fuel corporations and their value- but this is not the case. When an entity chooses to divest holdings, the company divested from does*not lose value, as shares are bought on a secondary market by investors not holding the same qualms as the original stockholders. By divesting,*The Republic of Ireland has lost its ability to engage leaders at shareholder meetings, leaving the fund instead with fewer holdings (less diverse funds are less risk averse funds) and millions to reinvest in less-proven industries.
This political maneuver was ill-advised and as an organization that exists to keep politics out of the management of public funds, IPFI cannot condone this action.

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  #303  
Old 07-15-2018, 09:18 PM
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RUSSIA

http://www.euronews.com/2018/07/06/r...reform-sources
Quote:
Russian authorities prepare to soften pension reform - sources | Euronews

Spoiler:
MOSCOW (Reuters) – Russian authorities are considering ways to soften a plan to raise the pension age, two sources familiar with the discussions told Reuters, following protests and a slide in President Vladimir Putin’s popularity ratings.
The government announced its plan last month to raise the retirement age for men to 65 from 60 and for women to 63 from 55 to ease pressure on state coffers from an ageing population and weak economic growth made worse by the impact of sanctions.
Since the plan was announced – on June 14, the opening day of the soccer World Cup which Russia is hosting – opinion polls have shown a drop in Putin’s normally robust ratings and thousands of Russians have attended protest rallies.
The two sources, speaking on condition of anonymity, said senior officials were holding discussions about options for softening the law, though they also stressed no final decision had been taken.
“There are different proposals (under consideration) – for example, an increase of five, not eight years, for women,” said one of the sources.
“Something will be softened during the (discussions) process,” said the second source close to the discussions, without providing further details.
A third source, who is close to the Kremlin, said he expected a final decision on pension reform by September, ahead of elections in some Russian regions, including a vote for Moscow’s mayor and the governor of the Moscow region.
Dmitry Peskov, the Kremlin spokesman, told reporters on Friday the government and the lower chamber of parliament, the State Duma, were working on the pension reform.
“The president is aware of the (people’s) reaction to the proposals and parameters,” Peskov said, without elaborating.
PUBLIC DISCONTENT
Natalia Timakova, spokeswoman for Prime Minister Dmitry Medvedev, told Reuters the proposals made by the government last month remained “the working variant”.
After Medvedev announced the proposal, a survey by the FOM pollster showed that the number of Russians who said they would vote for Putin had fallen by eight percentage points in a week to 54 from 62 percent and that his approval rating was down six percentage points to 69 from 75 percent.
According to the FOM pollster, around 80 percent of Russians are against the retirement age increase. Another poll, by the state VTsIOM pollster, showed that Putin’s approval rating had tumbled by around five percent.
Last Sunday thousands of people attended protest rallies led by supporters of Alexei Navalny, the most prominent Kremlin critic, around the country, though there were no demonstrations in cities hosting the World Cup due to security restrictions in force during the tournament.
Navalny published photos of the protests with people carrying placards with slogans including “Raise the pension, not the pension age!” and “Hands off our pensions!”.
The Russian budget is under pressure from a growing number of pensioners and a shrinking workforce caused by a sluggish birth rate in the early 2000s.
A higher pension age would allow the government to raise pension payments while freeing up state funds that could be spent on spurring economic growth amid Western financial and economic sanctions.
But analysts at Alfa Bank said in a note to investors that the chances for a softening of the reform were “quite high”.
“The scale of the negative reaction to the pension reform is big: Putin’s rating has fallen… to its lowest since 2013,” Alfa said. “People’s negative reaction increases the chances that the authorities will choose to make a compromise.”
A second source close to the Kremlin told Reuters: “It is obvious that the president must make a present (to people).”

https://worldview.stratfor.com/artic...a-dilemma-ages
Quote:
In Russia, a Wave of Protest Greets Pension Reform Plans

Spoiler:
While the World Cup soccer tournament has drawn the world's attention to Russia, an issue that will affect millions of its citizens has been unfolding at the same time, albeit with less fanfare. For the past month, one of the most sensitive and politically charged matters in the country has been a plan to increase the retirement age. The details of the proposal were announced June 14 by Russian Prime Minister Dmitri Medvedev, and the draft plan stipulates increasing the retirement age in stages beginning in 2019. For men, the age would rise from the current number of 60 to 65 by 2028. For women, it would rise from the current 55 to 63 by 2034.
The Big Picture
In the 2018 Annual Forecast, Stratfor highlighted Russia's prolonged economic stagnation as a key issue for the Kremlin. The announcement of plans to raise the retirement age fits within the government's efforts to stabilize its financial position in the long term, but that increase may come with a significant political price tag.
See 2018 Annual Forecast
The pension reforms are part of a long-deliberated plan by the government to cut spending. Raising the retirement age has become a key component of the*Kremlin's plan to deal with the economic strain*that has followed years of sanctions imposed by the United States and the European Union and the dip in global energy prices. Russia's Pension Fund reportedly has enough assets to cover only 60 percent of its obligations to current pensioners, with the balance of payments coming from the annual government budget. According to a think tank affiliated with the Russian Finance Ministry, the retirement age increase could help reduce the budget transfers needed to prop up the fund by*up to 1.7 trillion rubles ($27.3 billion) per year.

Raising the retirement age, therefore, would allow the government to both increase pensions and tackle inflation. Labor Minister Maxim Topilin has stated that if fewer people were drawing pensions, individual payments could rise as much as 10 percent within a few years. The appointment of reform advocate Alexei Kudrin as chairman of the Russian Accounts Chamber after*Putin's inauguration in May*demonstrated that the country would become more serious about economic reform in the president's fourth term. Kudrin said that if the current plan to raise the retirement age were fully implemented, pension payments could be increased by as much as 30 percent.

However, raising the retirement age has always been a controversial topic in Russia, where life expectancy is significantly lower than in most Western countries. According to data from the World Health Organization, male life expectancy there in 2017 was 64.7 and female life expectancy was 76.3. Although the government forecasts that life expectancy will increase to 70 for men and 80 for women by 2034, the fact that the ultimate male retirement age exceeds the current life expectancy has made the reform plan quite unpopular.

Protests against the reforms have taken place over the past month across Russia despite the decree that public demonstrations would not be allowed in the 11 World Cup host cities during the tournament. Protests have still occurred in numerous cities that are not match sites. While these protests were initially organized by small, local parties, national opposition leader Alexei Navalny has joined the cause, setting up protests in 20 cities on July 1. Russia's largest labor unions have also spearheaded opposition to the measure. The Federation of Independent Trade Unions has joined in the calls for protest, and the Confederation of Labor started a petition against the pension reforms that has attracted more than 2 million signatures in a matter of a few days.
The demonstrations thus far have been relatively small, generally drawing hundreds of people, and up to a few thousand in cities such as Omsk at their peak. But the protest movement has persisted for nearly a month, and once the World Cup concludes on July 15, demonstrations could again be held in larger cities, including Moscow. That means the rallies could grow in size and scope in the coming weeks as opposition parties across the political spectrum, from the liberal Yabloko to the right-wing Liberal Democratic Party, look to take advantage of the popular discontent.

https://www.dw.com/en/russians-outra...lan/a-44501313
Quote:
Russians outraged by pension reform plan | Business| Economy and finance news from a German perspective | DW | 03.07.2018

Spoiler:
Tens of thousands of Russians have been protesting against a government pension reform proposal that includes raising the retirement age for both men and women. DW's Miodrag Soric reports from Moscow.
There's growing resistance to Russian Prime Minister Dmitry Medvedev's planned overhaul of the pension system. Thousands have taken to the streets to protest the gradual increase of the retirement age.
In a step-by-step process, the retirement age for women is to rise to 63 by 2034. Men will be able to retire at the age of 65 by 2028. In line with a 1932*law, women have so far been able to retire at 55, men at 60. Interim attempts to raise the retirement age have all failed, with the last such effort coming to nothing in 2005.
Back then, President Vladimir Putin promised not to touch the current retirement age "as long as I'm president." Right now, though, he's keeping mum about the prime minister's proposal. In fact, many experts believe he's sent Medvedev into the battle on his own behalf to see how ordinary Russians will react.
If resistance to the reform plans grows too strong, Putin could then back-pedal or try to find a mutually acceptable compromise.
A matter of comparison
By European and global standards, Russians get to retire early. What many critics fail to consider is that the pensions paid out are hardly enough to make ends meet. That's why most people continue to work as long as they're healthy enough to do so.
According to official figures, the average pension in Russia is 13,342 rubles (€180, $210) — that's not exactly much, but is nonetheless an important financial contribution to ease hardships.
Authorities have so far allowed protests against the pension reform plans in all cities in which there are no World Cup matches going on. Once the soccer tournament is over, protests are expected to also reach Moscow and St. Petersburg. Recent polls have shown that nine in 10 Russians are opposed to raising the retirement age.
Millions of Russians are concerned they might not live long enough to get any pension payouts. Men's average life expectancy is 67.5 years. If they were to retire*at 65, they would be receiving payouts for only two years. Add to this that in 47 of a total of 83 regions in the country average life expectancy is even below 65 years.
Treated unfairly?
Hence many people think the planned reform is a grave injustice — to get nothing back from the pension fund after a tough*working life, the economic hardships experienced in the former Soviet Union and the upheavals of*the 1990s. It's no consolation for them to hear that the average life expectancy is forecast to rise over the next couple of decades.

As Moscow floats its pension reform proposals, a higher retirement age is widely perceived among Russians as being unfair
Furthermore, hundreds of thousands of people didn't have regular work contracts in the 1990s, and that impacts their pension payouts. So, many pensioners would be punished once more for the state's inability back then to make an orderly transition from a planned to a free market economy and cushion the social effects of the dramatic changes.
People are also angry about what they perceive to be the government's clumsy maneuvers. On the eve of the World Cup, Prime Minister*Medvedev announced the reform plans, giving rise to speculation that the Kremlin was hoping to push through a highly unpopular measure while people were busy watching soccer games.
Critics galore
Independent trade unions and regime critics are now trying to profit from this blunder. Supporters of opposition leader Alexei Navalny have called on people to organize protests, as have*the ultra-left Levy Front and others. In Omsk, Vladivostok and Tver, thousands of people took to the streets to demand Putin's resignation and that of the whole government.
Communist leader Gennady Zyuganov points out rightly that the popularity of the governing parties has fallen 12 percent in the past few weeks, while the Communists have gained 5 percent. The latter aim to stage a nationwide referendum on the government's proposal. A petition against the plans has already been signed by 2.6 million people.
What's troubling the Kremlin is that resistance to the pension reform is uniting parliamentary and non-parliamentary opposition forces. Among the opponents is exiled oligarch Mikhail Khodorkovsky.
The current public debate has tended to give short shrift to purely economic factors, including Russia's demographic problem. There are 43 million pensioners in the country. The number of those paying into the pension system is falling, while the number of people entitled to a pension is rising. Average life expectancy has increased by seven years since 2005. Since 2012, Putin has hiked pension payouts by 40 percent, which has been a heavy burden on state coffers. But the state can only provide adequate financing as long as oil and gas prices are sufficiently high.
Moscow*pumps some €45 billion into the statutory pension fund annually. Making private provisions for old age is not a popular concept with most Russians who still tend to rely heavily on the state.
No matter what the World Cup may bring for Russia — the Kremlin looks unlikely to be able to ignore the groundswell of opinion against the pension reform plans forever.

https://www.reuters.com/article/us-s...-idUSKBN1JY0GQ
Quote:
World Cup exit strips Putin of cover for pension reforms | Reuters

Spoiler:
MOSCOW (Reuters) - Russia’s elimination from the soccer World Cup on Saturday poses a challenge for the Kremlin: How to manage public anger over reforms that will hit voters’ pockets without the distraction of national sporting success.


FILE PHOTO: Russia's President Vladimir Putin (C) poses for a picture with (L-R) former player of team Germany Lothar Matthaeus, FIFA President Gianni Infantino, First Vice President of the Russian Football Union Nikita Simonyan, former player of team Denmark Peter Schmeichel and former player of team Mexico Jorge Campos during a meeting at the Kremlin in Moscow, Russia July 6, 2018. Sputnik/Alexei Druzhinin/Kremlin via REUTERS
After months of delaying a change it knew was liable to anger voters, the government said it was pushing back the retirement age. It made the announcement on the day of the tournament’s opening game, when many Russians were distracted by their team’s emphatic win against Saudi Arabia.
Since then, Putin’s popularity rating has suffered a rare dip, opinion polls show. A separate survey found that most Russians take a negative view of the plan to raise the pension age to 65 from 60 for men and to 63 from 55 for women.
Russia’s unexpected passage to the quarter-finals — their best World Cup since the 1991 fall of the Soviet Union — has captivated the nation and kept the reform out of mind.
But after Saturday’s defeat to Croatia and with the tournament due to end on July 15, the reforms are bound to resurface in Russia’s collective psyche, political analysts say.
Though perceived outside Russia as an all-powerful ruler unruffled by what people think, Putin’s authority in fact depends in large part on his ability to command popular support, which he and his aides devote massive energy to nurturing.
Following the polling backlash, officials were now considering ways to soften the pension reform, two sources familiar with discussions told Reuters.
“Any victory comes and goes. People forget,” said Nikolai Petrov, a political analyst at Moscow’s Higher School of Economics.
“...Every day people will remember that they could be receiving their pension but are not getting it because of this bad government,” referring to how some people were likely to perceive Putin’s administration.
SHIFTING AGENDA
A survey conducted by FOM before Russia’s World Cup exit showed Putin’s approval rating down six points at 75 percent. Another by state pollster VTsIOM showed a five percentage point drop.
The World Cup took some of the sting out of that unpopularity. A survey conducted by the independent Levada Center before Russia were eliminated showed the competition was occupying Russians’ thoughts more than the pension plan.
Levada Center sociologist Stepan Goncharov said this situation would now change.
“It’s fair to say that the issue of pension reforms will return to the top (of the agenda) after the end of the tournament,” he said.
The extent of popular outrage at the plan, which aims to ease pressure on state coffers from an ageing population and a struggling economy further weakened by sanctions, would depend on what the government did next, he said.
A final decision on what form it will take is expected in autumn.
Thousands of Russians protested this month against the planned rise in the retirement age, but there were no demonstrations in World Cup host cities because of security restrictions in place during the tournament.
The Kremlin this week shrugged off the idea it might face greater public pressure over the reforms once the World Cup ended.
“It is the job of experts to reach these conclusions,” Kremlin spokesman Dmitry Peskov said. “Let them do that.”

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  #304  
Old 07-19-2018, 02:57 PM
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RUSSIA

https://www.bloomberg.com/news/artic...-pensions-ploy

Quote:
Putin’s Silence Unnerves Russia After ‘Panic’ Over Pension Plan
Spoiler:
Russia’s attempt to roll out a proposal to increase the pension age under the cover of the World Cup has triggered the worst tumult President Vladimir Putin has faced at home in years, fueling speculation the Kremlin might soften a reform that’s crucial to righting public finances.

A decade in the making but unveiled hours before the Russian national team’s opening game at the soccer tournament last month, it came at a time when incomes stagnate and the economic outlook remains dim. The plan to push back the time people can retire starting next year quickly spilled into protests and a steep drop in Putin’s poll ratings. Among the four parties in parliament, only the pro-Kremlin United Russia supported the legislation on Thursday.


Through it all, Putin kept mum in public, even though he approved the proposal before it went to parliament, according to two officials familiar with the deliberations. Authorities knew that the reform, while seen as inevitable, would be a tough sell, they said. But Putin’s public silence amid the signs of popular opposition has sown uncertainty about the Kremlin’s plans, even within the government, these people said, speaking on condition of anonymity to discuss confidential deliberations.

Lawmakers in Moscow approved the bill in first reading and also extended the period of deliberation by a month until Sept. 24. While that’s leaving the ball in Putin’s court, the president is only likely to speak up before regional elections in September, according to Evgeny Gontmakher, a former government official.

“A certain panic has set in among the government ranks-- evidently they didn’t expect such reaction,” said Gontmakher, who’s also a management board member at Moscow’s Institute of Contemporary Development. “I don’t rule out some watering down.”

Confidence Broken
Putin is losing trust of Russians after plan to raise pension age


Source: polling company VTsIOM

Despite reports of worry in the Kremlin, Russia’s government has tried to stay on message. Finance Minister Anton Siluanov has insisted there will be no change to the parameters of the overhaul.

But in a sign of a rift among lawmakers, 104 members of the lower house of parliament opposed the bill on Thursday, with 328 votes in favor. Several United Russia lawmakers were absent for reasons ranging from health problems to travel, and one cast a ballot against, according to the Vedomosti daily.

The proposal has rankled Russians because life expectancy remains so low that it would allow for too few years of retirement. Life expectancy is currently under 68 for men and below 78 for women. Meanwhile, poor job prospects could leave many older people unemployed.

According to an analysis by Alfa-Bank, international experience shows that governments pre-announce pension reforms by an average of five years, introducing them at moments of faster economic growth and exposing a smaller share of the population.

Russia’s Reckoning
Putin’s re-election to a record fourth term in March elections provided an opening for a decision that Russia had long dreaded. It has one of the lowest retirement ages in the developed world, unchanged since 1932, leaving the government to contend with growing expenses as the population shrinks. Women can stop work at 55 and men at 60.

Under the proposal, the retirement age will rise gradually, reaching 65 for men by 2028 for men and 63 for women by 2034. To sweeten the offer, the cabinet has suggested raising the average monthly pension.

As a result, the number of retirees is projected to fall by almost 14 percent to 31 million by 2034, with Alfa-Bank estimating that expenditures for the state pension fund could drop by about 300 billion rubles ($4.8 billion) every two years. The changes could add about 0.2 percentage point to potential economic growth each year, Bloomberg Economics estimates.

Backlash Builds
Still, the public fallout has been swift. Confidence among Russians in Putin fell below 38 percent in the first two weeks of July, the lowest level since December 2011, according to state-run polling company VTsIOM. Another recent survey found that 80 percent oppose the plans, with 43 percent of respondents saying they’d join any local protests against them if they take place.

Another point of contention is that for now it excludes changes in spacial benefits for the military and law enforcement that allow veterans to retire early.

As for the ill-timed rollout, the finance minister said it was “pure coincidence” that the announcement came on the opening day of the World Cup.
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Old 07-22-2018, 09:45 AM
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VENEZUELA

https://www.yahoo.com/news/seniors-b...213439933.html

Quote:
Seniors block Venezuela streets demanding pension checks

Spoiler:
Caracas (AFP) - Perched on plastic lawn chairs and leaning on canes, scores of retirees protested Wednesday to demand payment of their retirement benefits in crisis-hit Venezuela.

About 200 senior citizens blocked traffic on Urdaneta Avenue, a stone's throw from the presidential palace.

"They are not paying people's whole pension. We are just getting two million" bolivars, worth 60 US cents at black market rates, said Basilio Octo, 68.

That might get him 15 eggs but it's a quarter of his monthly income in a country with dizzying hyperinflation.

It could top 13,800 percent this year, the IMF says.

Currency notes are in very short supply; in some markets food and other basic goods can be purchased for three times less if the buyer pays cash.

So seniors are desperate to stretch their income by paying in cash.

Octo says he often has to get up at 3:00 am to go wait outside the bank and withdraw money.

"If we have to pay with a card, we are getting robbed," Octo explained. What could cost 10,000 bolivars in cash costs 40,000 with a card.

"Mr President (Nicolas Maduro), it's time for you to take responsibility," he said.

With the economy barely functional, food in short supply and hunger rampant, the seniors took turns chanting "WE WANT CASH."

On June 20, Maduro raised monthly pensions for seniors to 4.2 million bolivars. But a pound of meat costs five million.

"A banana and a plantain is what I can get with that money," grumbled Eulice Bolivar to AFP.

"The elderly are out protesting because they need their money. They need their food. There is too much hunger in Venezuela," she said.


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Old 07-25-2018, 02:19 PM
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RUSSIA

https://www.ai-cio.com/news/russias-...sion-age-hike/
Quote:
Russia’s Lower House Approves Pension Age Hike | Chief Investment Officer
Spoiler:
Putin’s silence leads to heavy criticism, harking back to his earlier pledge to not raise the eligibility level.
Russian protests fell on deaf ears Thursday as the Kremlin approved changes to its pension system.
Next year, the new retirement age will be raised to 65 for men (from 60) and 63 for women (from 55), and given the country’s low life expectancy (65 for men and 76 for women), many will never see retirement—let alone the benefits. Regardless, the Russian government said an age hike was inevitable as payouts under the old benefits rules are too costly for its finances.
The increase will not affect current beneficiaries. It will take effect gradually over 15 years.
The bill passed in the State Duma, Russia’s lower house, in its first reading, with 327 lawmakers voting in favor and 102 against. After public comment, the measure will return for a second reading and another vote by the Duma.
Labor Minister Maxim Topilin, a supporter of the bill, told parliament the old pension laws were “stuck in the 1930s,” as today’s economy and life expectancy are very different from that period. Topilin told Russian news organization Tass that Russia will allocate 3 trillion rubles ($47.2 billion) to the pension program over six years.
Prime Minister Vladimir Putin has not yet given a public statement on the reform. Lawmakers were told not to criticize the president during the discussion, Russian news outlet Vedomosti reported.
The age hike is the first in almost 90 years, creating a mass of Putin-bashing from citizens and political parties alike. Some of these groups include the Communists, Liberal Democratic Party, and A Just Russia, an anomaly as the three parties usually comply with the Kremlin while in disagreement with each other. More than 80% of Russians oppose the reform, and more than 2.8 million people have signed a petition to pull it, the French news agency AFP reports.
The pension protests have also caused Putin’s approval rating to plummet to an all-time low. Critics cite his pledge in 2005, during his second presidential term, that there would be no benefits age increases “while I am president.”* The VTsIOM state pollster says Putin’s approval ratings dropped 14 percentage points in roughly two weeks, from 78% to 64%.
Communist lawyer Oleg Smolin told the media that Putin needs to take a stance on the crucial law.
“This is one of the most important laws in the last 14 years. It cannot be debated without such an important person in our political life,” he said.

https://www.ai-cio.com/news/putin-sa...overhaul-plan/
Quote:
Putin Says He Doesn’t Like Pension Overhaul Plan | Chief Investment Officer
Spoiler:
Russian president voices doubt about controversial proposal to raise retirement ages.
Russian President Vladimir Putin has broken his silence on the changes to the retirement ages thatpassed Thursday in the State Duma, the country’s lower house: He doesn’t like the plan.
The proposed reforms bump the retirement ages from 60 to 65 for men, and from 55 to 63 for women. Kremlin-friendly political parties, members of parliament, and the general public have protested these alterations, plummeting Putin’s approval rating from 78% to 64% in about two weeks.
The president has been noticeably quiet about this move until Friday, when he said, “There is no final decision,” on the pension changes, Reuters reports. “I will need to hear all opinions and points of view on this issue.”
At a soccer game in Kaliningrad during the World Cup, he said that a pension reform was necessary as the country’s finances are thinning, according to the news agency.
He did, however, admit that he did not like any of the reforms, which passed in the first of three readings.
“I like none of the ones linked to raising the [retirement] age,” he said Friday on local television. *“And I can assure you that in the government too, there are few people, if any at all, who like them either.”
While Russia’s president reiterated that a pension overhaul was inevitable, he said there was a small window where no changes could be made, but if the issue wasn’t dealt with sooner rather than later, it could lead to big problems for the Kremlin.
“Broadly speaking, you could do nothing for five, six, or even 10 years. We are able to maintain the pension system,” he said. “But what will happen in the medium, and longer-term? Then either the pension system will collapse, or the budget from which we finance the [pension] deficit will collapse.”

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Old 07-27-2018, 09:38 AM
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RUSSIA

https://www.washingtonpost.com/news/...=.8d41ecee7f22
Quote:
The crisis that could take down Putin’s presidency
Domestic politics — not tension with the U.S. — poses the biggest threat to Putin.
Spoiler:
Russia’s Vladimir Putin is all over the news — portrayed as having some sort of leverage over President Trump and rapidly becoming a central figure in U.S. politics. But back home, Putin is being assailed for a very different reason: muting criticism of an unpopular plan to increase Russians’ retirement age. The bill, whose first reading was approved by lawmakers last Thursday, would mandate that men retire at 65 instead of 60, and women retire at 63 instead of 55.

Opposition activist Alexei Navalny has started a campaign informing citizens which local politicians supported the pension reform to systematically vote them out of office. The Russian Internet is awash with memes criticizing the reform and the deputies who supported it. Public protests have spread, and 20 people were arrested in St. Petersburg last Wednesday.

Pension reform is always a politically fraught process, but Russia faces specific challenges inherited from the country’s Soviet past. By the last decades of the Soviet Union’s existence, old-age pensions had become inviolable guarantees: In exchange for their tireless labor and their service to the state, ordinary citizens were promised future financial security. That guarantee was eviscerated with the collapse of the U.S.S.R. and the economic catastrophe of the 1990s, which Putin promised to reverse.

ADVERTISING

Putin now wants to touch the third rail of Russian domestic politics. In reforming the pension system, he threatens to undermine one of his key sources of support: those who depend upon state pensions to survive. He has also provoked anger and anxiety among those who fear that the money will be long gone by the time they reach the age to claim a pension.

The Bolsheviks came to power in 1917 promising sweeping benefits to workers, including old-age pensions, but it took another 10 years for the economically embattled regime to actually pay them. The first pensions were offered to textile workers in 1927 and were rolled out to other industries over the course of the first Five-Year Plan. The current retirement ages were set in 1930; workers in dangerous or remote industries could retire even earlier as an incentive to enter these lines of work. In short, pensions were rewards for workers who embraced communism and contributed to the country’s industrialization and socialist development.

But the Stalinist old-age pension system was flawed. Pensions were capped at low amounts and not adjusted for inflation, which meant that pensioners were often some of Stalinist society’s poorest members.


And not everyone received even these meager pensions: Although the 1936 Constitution guaranteed citizens “maintenance” in old age, amid massive labor turnover, pensions became not only a carrot but a stick as the regime struggled to get workers to stay put and be more productive. Many workers were denied a pension due to gaps in their employment history or inadequate time in the workforce. Collective farmers, who were the target of some of the Stalinist regime’s most repressive policies, were categorically ineligible.

Pension reform was thus high on new Premier Nikita Khrushchev’s post-Stalinist agenda. Although he retained the previous system’s emphasis on labor discipline as a prerequisite for receiving a pension and continued to exclude collective farmers, an October 1956 law harmonized the Stalin era’s piecemeal pension legislation and raised and standardized the amounts most pensioners received.

Khrushchev’s decree also enshrined that the Soviet pension system would be different from systems such as America’s Social Security program. He promised that workers would never be asked to pay for their own pensions. In practice, this meant that workers did not see deductions from their monthly wages toward their pensions as U.S. workers do; instead, the enterprises they worked for paid into the state’s social insurance fund on their behalf. This allowed the government to crow about the superiority of the socialist approach and the regime’s largesse.


In 1977, a new constitution affirmed citizens’ right to old-age pensions, and the tenure of Khrushchev’s successor, Leonid Brezhnev, is often thought of as the Soviet Union’s “golden years” of high living standards. Oil profits allowed the government to fund a generous social welfare agenda, including subsidizing old-age pensions.

But Brezhnev left a sinking economy behind, and the burden posed by pensions soon became unsustainable. In 1990, Mikhail Gorbachev sought to rework pension financing to involve workers’ own contributions, but the Soviet Union collapsed before these reforms could be implemented.

Pensioners were among the hardest hit by Russia’s transition to a market economy. During the 1990s, the Russian pension system moved toward the U.S. Social Security model, financed by wage taxes paid by the younger generation, instead of being subsidized by the state budget.


That move, however, did not prevent the government’s pension fund from collapsing. Hyperinflation undermined the value of pensions, making poverty among the elderly commonplace.

Putin came to power promising to stabilize the Russian social welfare system and improve living standards. During his first presidency, he eliminated past-due pension payments and increased amounts. In 2002, his government unveiled a new pension system for the elderly financed by contributions paid by citizens born after 1967.

In 2009, a voluntary co-financing scheme — paid by employees and the government — was introduced to try to stabilize the system’s finances. That system was partially rolled back in 2013 after the government passed a controversial law giving it more control over private pension funds, raising fears about the nationalization of pension savings to fund other state priorities.


And yet, none of these fixes offers an answer for a poor economy. Russia’s economy has been contracting because of the strains caused by sanctions imposed in the wake of its 2014 annexation of Crimea, as well as low oil prices. The pension system is in dire financial straits, which is why the government now wants to raise the retirement age.

In reforming Russia’s pension system, Putin faces the impossible task of satisfying older citizens who see their pensions as a right and guarantee (many of whom support Putin precisely because he pays their pensions) and younger citizens whose contributions to the pension system are critically needed, but who are now incensed that they might not get to enjoy the same rights and guarantees. Across the board, Russians are grousing at being asked to pay into a system, when the new retirement ages and low life expectancy mean that they won’t earn back what they paid in.

Russians’ support for Putin is often attributed in the West to his promotion of conservative values, encouragement of nationalist sentiment and returning Russia to “great power” status. But it also rests on a much more basic promise to the population: steady improvements to their living standards. Pension reform threatens Putin’s image as someone who has brought increased prosperity to the average post-Soviet citizen — an image based upon efforts in his early years in office to alleviate poverty.

While Americans may view Putin as a subversive threat to democracy, many Russians see him as a protector. The proposed pension reform puts that image at risk. Some Russians now see Putin as a threat to their very well-being. And what they decide will have a far greater say in Putin’s long-term political fate than anything tied to President Trump or relations with the U.S.


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Old 08-02-2018, 03:01 PM
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JAPAN

http://the-japan-news.com/news/article/0004616059

Quote:
Behind the Scenes / Only 40% pay national pension premiums
Spoiler:
With many people, including the self-employed, not paying into the national pension plan, the system is becoming increasingly hollowed out. The officially announced payment rate is in the 60 percent range, but the actual situation is worse. The risk is growing that many elderly people will only be able to receive a meager pension in the future.

Up for 6 straight years

The Health, Labor and Welfare Ministry announced in June that the national pension premium payment rate (see below) in fiscal 2017 was 66.3 percent. This is 1.3 percentage points higher than the previous fiscal year and represents the sixth consecutive yearly increase since fiscal 2011, when the rate stood at a record low of 58.6 percent.

“We broadened the scope of compulsory collection and also continued to encourage people to pay. We’re now seeing the results,” a Health, Labor and Welfare Ministry official said.


The Yomiuri Shimbun

Until the mid-1990s, however, the payment rate was more than 80 percent. For the mandatory subscription system, a payment rate in the 60 percent range is woeful.

National pension premiums are mandatory for those classified as Category 1 insured persons, which includes the self-employed and part-time workers. Unlike employees’ pension premiums, which company employees have deducted directly from their salary, Category 1 insured persons must pay on their own.

The national pension premium has been raised by more than 100 percent, from 7,100 per month in fiscal 1986, when the current system was put in place, to 16,340 in the current fiscal year. In addition to this increased burden, another reason for the low payment rate is the sense of distrust spreading among younger generations — Is the pension system really reliable, they wonder.

A variety of measures

People who continue to be in arrears are in danger of receiving no pension after they retire. The ministry and the Japan Pension Service are employing various measures to increase the payment rate.

One method is a discounted premium rate. A new system introduced last fiscal year allows people to pay two years of premiums in advance via credit card. Compared with paying in cash every month, this enables people to save about 14,000 over two years. However, there is no such discount for company employees’ pension plan, so this strategy can be criticized as unfair.

About 14,000 people who were in arrears had savings and other assets seized last fiscal year. Such carrot-and-stick measures appear to have been effective to a certain extent.

In arrears versus exempted

It is not only people in arrears who do not pay premiums — there are also low-income earners who utilize the payment exemption system. Almost every day, a JPS office in Saitama Prefecture receives calls from people in arrears who say there is no way they can pay.

“We have the payment exemption system for people whose income is low. You can use it, but your pension benefits will be lower in the future,” an experienced pension official tells them, explaining about the procedures to use the system.

Pension benefits are not paid out for the period during which payments were in arrears, but if people are exempted from paying, their pension benefits will not be zero but half the standard amount.

Therefore, the JPS strongly recommends low-income earners who are in arrears to use the exemption system. This is not wrong in itself.

Number magic

The JPS recommendation appears partly spurred by its desire to boost the payment rate. What does this mean, exactly?

Calculations for the payment rate officially announced by the ministry do not include the 5.74 million people — as of the end of March this year — who receive partial or full exemptions. According to a senior Health, Labor and Welfare official, this is because “they’re not legally obligated to pay.”

When many people are in arrears, the payment rate drops. However, if such people newly come under the exemption system, they are not included in the calculations and the figure consequently goes up.

If people using the exemption system are included in the payment rate calculations, the actual rate for fiscal 2017 stands at 40 percent, although the ministry does not officially disclose such figures. This is 26 percentage points lower than the officially announced payment rate of 66.3 percent.

Moreover, this actual payment rate is down about seven percentage points from 47 percent 10 years ago. One reason is that the JPS recommends people use the exemption system.

In 2006, the former Social Insurance Agency, the predecessor to the JPS, was found to have allowed unlawful exemptions, doing paperwork for the exemption system without receiving people’s consent. As many as 1,770 JPS employees were punished across the country in connection with the scandal. The employees were making no effort to collect pension premiums and instead simply lowered the number of people required to make premium payments, so as to improve their own work performance results.

The JPS stressed that it no longer conducts this kind of illegal activity. However, doubts remain over whether it recommends taking the exemption even to low-income earners who have certain assets such as savings and could therefore pay the premiums.

(From The Yomiuri Shimbun, July 24, 2018)

Collection measures need to be strengthened

“The pension system will fall apart if many people are in arrears” — this concern is often raised but it is a complete misperception. People who are in arrears will not receive pension benefits for the corresponding non-payment period. Those who have received exemptions will only be given reduced pension benefits, so pension finances will not be negatively affected.

However, if the present situation continues, it will lead to a large number of elderly people living on limited pensions. Even now, livelihood protection allowance costs are as high as nearly 4 trillion, and this could increase even more.

The higher costs will be covered by the taxes of future working generations. The current low payment rate is the equivalent of billing future generations. This is exactly why the ministry and the JPS must move forward with measures to get people in arrears to pay premiums.

Currently, 312 pension offices across the country as JPS branches are in charge of collecting premiums. Isn’t it possible to ask for cooperation from municipalities in performing this task? One idea is changing the current system in which companies directly deduct employees’ pension plan premiums only from full-time workers’ salary, to one in which they also collect premiums from part-time workers’ salary and pay them to the government.

Innovative ideas are needed to resolve the situation.

■ National pension premium payment rate

The percentage of people who paid premiums, among the total number of people who are obliged to pay them, in a particular fiscal year. To calculate the rate, the number of months in which people paid premiums across the country is divided by the number of months premiums were required to be paid in a particular fiscal year. Exemptions for low-income earners, university students who have deferred their payments and others are excluded from this calculation. As people in arrears sometimes pay premiums in the subsequent fiscal year and beyond, the final payment rate, in many cases, is nearly 10 percentage points higher than the figure that was originally announced.Speech


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Old 08-08-2018, 09:53 AM
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RUSSIA

https://www.fpri.org/article/2018/08...-russia-again/

Quote:
Reversing Pension Policy in Russia... Again
Spoiler:
About a month after Vladimir Putin’s re-election as President of the Russian Federation in March 2018, Prime Minister Dmitry Medvedev announced that the Russian government would be considering proposals to increase Russia’s pension age. This announcement was a reversal of a long-standing policy by Putin and his United Russia party to avoid doing just that. For the past 18 years, Putin has either avoided the question of raising Russia’s retirement age, or promised not to. Now, he says, things have changed. Putin recently announced that he does not like raising the pension age, but argues it has become necessary.

Medvedev was the one to make the actual announcement, and at a strategic time, just a month after Putin’s re-election and during the World Cup to maximize distraction from the issue. Per the Russian constitution, Putin cannot run again for another consecutive term although he could legally take a term off and run again after that (which is what he did from 2008-2012 when Medvedev had a turn as president while Putin served as Prime Minister). This term might be the last one for Putin who will be 72 in 2024 when his current six-year term ends (and he would, therefore, be 78 before he can legally run for president again under the current Russian constitution). As such, right after his last election is an excellent time to take potentially one of the least popular moves possible—raise the retirement age.

Protests against raising the retirement age began in June and have continued throughout the summer. The protests on Sunday, July 29 were reported to have had as many as 18,000 participants. While the approval ratings for United Russia have slipped as a result, Putin himself is still popular. In July, the Duma passed the first reading (of three total) of the legislative proposal for raising the retirement age thereby providing a rallying point for more protests. The first reading passed with almost unanimous support from members of United Russia. Although we’re likely to see protests and objections continue throughout the fall, it is also very likely that some form of the bill will be adopted in December 2018, and the government will proceed with plans to raise the retirement age.

Why is Raising the Pension Age so Unpopular?
There is a long legacy of the state being responsible for providing old-age pensions in Russia. In the Soviet state, pensions were not overly generous, but they provided adequate support for a large portion of the population and—critically—they were guaranteed.[1] Previous attempts to curtail pensioners’ benefits—as when the government enacted cuts to benefits in January 2005—have led to mass protests.

It is not surprising that raising the pension age is unpopular—raising the retirement age is unpopular around the world. Once citizens have been promised specific benefits at specific times, they are loathe to give them up. For instance, there were protests in France in 2010 and in Germany in 2014 when the government took measures to increase the retirement age.

Putin and United Russia care very much about what pensioners think. Retirees and near-retirees in Russia have proven willing to protest and vote. Russia does not have competitive, free and fair elections, but it does have elections and the government cares about how much it has to cheat. In short, the Russian government has good reasons not to spark widespread discontent.

Why has Putin Decided to Raise the Pension Age?
Many economists and policymakers have long argued that Russia needs to raise its retirement age. Russia has a relatively low retirement age of 55 for women and 60 for men. These ages are much lower than in Europe where retirement ages are typically 5 to 10 years higher. As a point of comparison, to draw full Social Security benefits in the United States the age is 67 for those born after 1960. That is 12 years older than for Russian women and 7 years older than for Russian men. As a sign of the policy turn-around in Putin’s government, one of these long-time advocates of raising the retirement age, Alexei Kudrin, the former Minister of Finance who resigned in 2012 over disagreements with Putin’s policies, has been brought back as the Chairman of the Audit Chamber. This post is not directly related to pension policy, but nonetheless signals an important shift in the government’s economic leadership.

The problem with a low retirement age is that it costs the government a lot of money. The earlier people retire, the longer the government has to support them. That is why governments in developed countries around the world have faced pressure to raise the retirement age.

Who is Organizing the Recent Protests against Raising the Pension Age?
Opposition to raising the retirement age has come from a variety of places. Protests occurred in cities across Russia. The largest protests were in the Omsk, a city in southwest Siberia. Here, leaders of the local branches of the political parties Yabloko, the Liberal Democratic Party of Russia (a nationalist party), the Communists, and A Just Russia organized protests alongside supporters of the high-profile opposition leader, Alexey Navalny.

It is not surprising that Navalny has taken up the issue of pension reform. This is a prime opportunity to siphon support away from United Russia and Putin, albeit with years to go until another national election. This is a potentially very unpopular move by Putin especially among older demographics that have tended to support him. The opposition could pick up some support by taking up this issue.

Not all of those opposed to Putin have jumped on the bandwagon opposing raising the pension age. By contrast, former presidential candidate and opposition to Putin—Ksenia Sobchak—has come out in support of the government’s plan to raise the retirement age.

What is the Significance of These Recent Protests? Are They Likely to Undermine Putin’s Long-Term Support?
Benefits for pensioners sparked big protests—the largest at the time (because it predated the 2011 and 2012 electoral protests)—in January 2005. But the government was able to move past that. There is no national election coming up soon, so opposition leaders are going to really need to maintain focus and organization on this issue, and that will be a hard task to accomplish. Putin has a lot of time to turn things around before the next Duma elections in 2021 or the next presidential elections in 2024. But one can envision a scenario where the government raises the pension age and has plenty of time to make other concessions and bring other issues to the fore before the current protests cause real problems. One possibility is that we see a lot of public protest about raising the retirement age through the rest of 2018, the government makes some concessions in the legislation (maybe) and passes the bill anyway, and we hear less about this from 2019 onwards.

In the West, news about Russia—understandably—has focused on the country’s interference in the politics of other countries including stories about poisonings and electoral interference. But domestic Russian politics tells us a great deal about the regime’s dynamics, and welfare state politics are an important authoritarian tool. This is not the first major turn-about in Russian pension policy. Pension politics has long been the domain of the elite with surprisingly little input from organized interest groups or political parties. Bureaucrats and politicians and other policy advisors have steered Russian pension policy in the direction they choose. In 2013, the Russian government began reversing a major pension reform that had been backed by the Putin administration and adopted in December 2001.

Once again, with the raising of the pension age, we see Putin and other elites backing a policy reversal when doing so is in their best interests. Whether or not this is the best policy course in the long run, the policymaking process here is far from democratic. But Putin is a savvy long-standing leader and, once again, he may just get away with it.

[1] Linda Cook, The Soviet Social Contract and Why It Failed: Welfare Policy and Workers’ Politics from Brezhnev to Yeltsin (Harvard University Press, 1993).
https://www.rferl.org/a/russia-bomb-.../29410083.html
Quote:
Bomb Blast Rips Up Facade of Pension Fund Office In Russian City

Spoiler:
Workers repair damage at the site of a blast outside the national Pension Fund office in Kaluga on August 3.
A bomb blast has badly damaged the front facade of a state Pension Fund office in the Russian city of Kaluga, local media reports say.
The apparent attack came amid public anger and frequent street protests over the government's plan to raise the retirement age.
Media outlets cited unidentified law enforcement officials in the city 150 kilometers southwest of Moscow as saying on August 3 that the door was blown up overnight. Footage from local station NIKA TV showed the damaged front door and exterior wall, with panes blown out, and chunks of tile around at the entrance.
Nobody was hurt in the explosion.
Reports said the Pension Fund office was operating normally on August 3, with access provided through a side door.
Government-backed legislation that passed in the first of four parliamentary votes on July 19 would raise the retirement age to 63 for women by 2034 and to 65 for men by 2028.
Currently, the retirement age is 55 for women and 60 for men. The plan sparked widespread anger after it was announced last month, and President Vladimir Putin's approval ratings have fallen.
Tens of thousands of people protested in cities across the country on July 28, and many other demonstrations have been held.
More than 2.9 million people have signed a petition against the reform on change.org.
Based on reporting by NIKA TV, Kommersant, Kaluzhskiye Novosti, and Novaya Gazeta

https://www.rferl.org/a/not-so-unite.../29413547.html
Quote:
Not So United: Russia's Ruling Party Rattled By Pension-Reform Crisis
Spoiler:
"United Russia" not feeling so united right now.
Speaking to a riled-up crowd at a July 28 protest against the Russian government's deeply unpopular proposal to raise retirement ages in Vologda, angry pensioner Nikolai Zharavin didn't mince words as to who was to blame.
"We need not only to drive out the government headed by [Prime Minister Dmitry] Medvedev," he said, "we also need to drive United Russia out of the State Duma. Then we'll see decisions made for the benefit of the people, instead of for the 10 percent that is the oligarchs and their families and the security services, whose interests are represented by [President Vladimir] Putin."
He cited a life expectancy in Vologda Oblast of under 65, suggesting that "only a handful of men will live to receive pensions."
"What good is this reform?"
WATCH: Several thousand people gathered in central Moscow on July 29 on a second consecutive day of protest against the Russian government's plan to raise the retirement age.
Political Damage Done
The first major economic initiative of Putin's fourth term, pension reform has become a harsh test for the ruling United Russia party. And the ordinarily watertight discipline is already beginning to leak.
The party's position is further complicated by the Kremlin's seemingly conscious strategy of distancing Putin from the reform, placing all the public responsibility for the move on Medvedev's government and United Russia.
"This reform has become a big test for the ruling party, of course, particularly because it comes just before [the September 9 local elections]." Nikolai Mironov, head of the Center for Economic and Political Reform think tank, tells RFE/RL.
"Among rank-and-file United Russia members, there are quite a few who don't agree with it. But for now, the party remains united and we don't see splits. This isn't the first time the United Russia has passed unpopular laws. What's more, members don't really have other options. Leaving politics altogether is even worse than agreeing with the reform and the prospects of the opposition are very weak. You aren't going to make a career there."
To bolster an economy creaking under such burdens as the costs of annexing Ukraine's Crimea region and the ensuing international sanctions against Russia, a chronic dependence on energy exports, and massive populist expenditures such as the hosting of this summer's World Cup soccer championship and raising state-sector salaries as part of Putin's reelection campaign this spring, the government is shepherding through the Duma a bill that would gradually increase the retirement age for men from the current 60 to 65 by 2028 and for women from the current 55 to 63 by 2034.
A poll earlier this month by the Levada Center suggested that about 90 percent of Russians oppose the reform. And, as might be expected, this opposition has quickly translated into waning support for Medvedev, his government, and United Russia. A Levada poll released on July 31 found that support for Medvedev had fallen to 31 percent, down from 42 percent in April. Support for the United Russia-dominated Duma fell from 43 percent to 33 percent over the same period. Despite the Kremlin's strategy of distancing Putin from the project, the president's rating dipped to 67 percent, down from 79 percent in May.
The more Kremlin-friendly All-Russian Center for the Study of Public Opinion (VTsIOM) on July 31 published a poll that was taken just three days after United Russia Duma deputies voted virtually unanimously to pass the bill in its first reading that found the party's rating had fallen to 37.1 percent, its lowest rating since late 2011.
Even in the Duma, Russia's lower house, United Russia was unable to maintain complete unanimity. Deputy Natalya Poklonskaya voted against it, drawing the ire of party leadership. Deputy Sergei Zhelenyak failed to show up for the vote, after which he was forced to resign his post as deputy secretary of United Russia's general council.
Regional Fraying
In the regions, where United Russia rubs up directly against public discontent, party discipline is showing more wear. In the town of Nerl in Ivanovo Oblast, all 12 members of the city council, including six members of the United Russia party, signed an appeal expressing unqualified opposition to the pension-reform plan.
In the Urals city of Nizhny Tagil, party member Nikolai Tarakhov handed in his party card, saying in his resignation letter: "The party's program and the activity of its leadership are now directed against their own nation. I do not want to participate in manure and get soiled by it."
Aleksandr Kryuchenkov, the local party secretary in the Ivanovo Oblast town of Zavolzhsk, also resigned, calling the policy "anti-people."

Vadim Provorov
"Aleksandr Kryuchenkov was a responsible and active party member," Vadim Provorov, a former United Russia member in nearby Kineshma who also resigned over the pension issue, tells RFE/RL, "but he couldn't stand it and left the party. Olga Matyushina, a very active person who was devoted to her hometown of Zavolzhsk and who did so much for her city.... And she also left the party for the same reason."
"We are only the first harbingers," Provorov predicts. "Just watch and you will see a mass departure from United Russia in the very near future. Every week, more will leave."
WATCH: What made tens of thousands of Russians join public protests against plans to raise the retirement age, in cities across the country on July 28-29?
Svetlana Gryunbaum, the top United Russia official in Kineshma, disagrees, saying that no one besides Provorov planned to quit, despite the public's disdain for the reform.
"They are calling us constantly, shouting at us, and accusing us of all possible sins," Gryunbaum tells RFE/RL. "'Why are we silent?' 'Why does the party accept this?'"
"I tell them to come in and write a complaint and we will send it to Moscow," she continues. "But for some reason, they don't come. What more can we do? I have no idea. Of course, we are all hoping that Putin won't sign it."
One United Russia activist in Kineshma who asked not to be identified and who remains in the party expressed serious reservations about the pension policy.
"My husband is 55, and for the last two weeks he has been in a deep depression," she tells RFE/RL. "He just sits there saying that while before he had a small chance of living to get a pension, now he definitely has none. And how are we supposed to survive for those additional years? There is no work in this town. Is he supposed to go to Moscow? They won't even hire him as a watchman there."
"What are we to do?" she muses about the fate of United Russia members. "We vote like they tell us to. We have solid party discipline. But inside, everything is boiling."
End Of Putin's Myth
The pension-reform crisis could become a defining milepost for Putin. A 2005 reform that eliminated in-kind social benefits such as free transportation similarly brought tens of thousands of protesters into the streets with calls for Putin's resignation. That opposition attracted the support of the Communist Party (which is playing a leading role in the current pension-reform protests), and many Kremlin loyalists -- including the mayor of Moscow, the governor of St. Petersburg, and the Russian Orthodox patriarch -- spoke out against the move.
The Kremlin's response at the time was a major crackdown on the protesters and the "provocateurs" who officials claimed were egging them on, as well as a pitiless tightening of discipline among regional officials and United Russia members.
"The pension reform has delivered a powerful blow to the regime," political analyst Abbas Gallyamov tells RFE/RL of the latest outcry. "It has become clear that Putin is not a miracle worker, that even for him some things don't work out. The myth of the great ruler that arose after the [annexation] of Crimea, of course, has not broken yet, but it is shaking. Criticism of the authorities has moved from the margins to the mainstream."
"And even backing away from the reform will not restore the previous status quo," he adds. "People might draw the conclusion that the authorities were frightened by the universal opposition and backed down. The people could develop a taste for protest if it becomes clear that by demonstrating their dissatisfaction, they can solve their problems."
The fact that active and enthusiastic United Russia members in the regions are leaving the party, Gallyamov says, is an indication that "the structure of the regime is beginning to crumble around the edges."
At an antireform protest in Pskov on July 28, protesters prepared banners with the slogans "Putin, if you have a conscience, resign!" and "United Russia is voting to rob pensioners!" Police immediately confiscated them before they could be unfurled, Pskov Oblast communist lawmaker Viktor Dulya told RFE/RL.
In Volgograd the same day, accountant Svetlana Tkacheva was among the protesters.
"The government's decision to raise the retirement age has made me angry," she says. "It will make things hard for us. We'd like to retire with a sound mind and a healthy body. We'd like to devote our retirement years to our grandchildren. The state is trying to save money at the expense of ordinary citizens and is spending our money on its own unjustifiable expenses."
Written by Robert Coalson based on reporting by Yelizaveta Mayetnaya of RFE/RL's Russian Service

https://www.reuters.com/article/us-r...-idUSKBN1KJ0HJ
Quote:
Protesters chant anti-Putin slogans at Moscow rally against retirement age plan | Reuters

Spoiler:
MOSCOW (Reuters) - Thousands protested in central Moscow on Sunday against a proposed increase to the retirement age and the crowd chanted slogans critical of President Vladimir Putin whose approval ratings have been dented by the bill.


The rally organized by the opposition Libertarian Party chanted “Putin is a thief” and “away with the tsar,” slogans common at anti-Putin and anti-government protests.
The retirement age proposal is politically sensitive for Putin, who was re-elected in March, because it has prompted a series of protests across Russia since it was announced on June 14, the day Russia played the first match of its soccer World Cup.

Around 90 percent of the population oppose the bill, according to a recent opinion poll, and a petition against it has attracted 3 million signatures online.
More than 6,000 people came to Sunday’s rally some 2.4 kilometers (1.5 miles) from the Kremlin, according to White Counter, an NGO that counts participants at rallies using metal detector frames. Police put the number at around 2,500.
People held placards with slogans against the higher retirement age and one read: “stop stealing our future”. Authorities detained two protest organizers, Vladimir Milov, a former deputy energy minister and now an opposition campaigner, told Reuters.
The proposal to raise the retirement age, to 65 from 60 for men and to 63 from 55 for women, is part of an unpopular budget package designed to shore up government finances that is backed by lawmakers.

Putin, who once promised not to raise the retirement age, has tried to distance himself from the pension plan.
This month he said he did not like any of the proposals. He said Russia could avoid raising the retirement age for years, though a decision would have to be made eventually.
Putin gives Russian army a political wing
“We have to proceed not from emotions, but from the real assessment of economic conditions and prospects of its development and (the development of) the social sphere,” Putin said.
On Saturday, more than 12 thousand rallied on the same street in Moscow, according to the White Counter data.
The changes to the retirement age would be introduced gradually, starting in 2019, Prime Minister Dmitry Medvedev said when presenting the plan. Officials said the measure should help to raise an average pension in Russia, now at around 14,400 rubles ($229.52).
Additional reporting by Valery Stepchenkov and Gennady Novik; Editing by Matthew Mpoke Bigg

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Old 08-21-2018, 09:47 AM
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http://www.genre.com/knowledge/blog/..._hsmi=65334649

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Why Time Is Running Out for Pay As You Go-Based Pension Systems
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None of us is getting any younger, just ask an actuary - or an economist, if it comes to that. Mortality is going down in almost all countries, and life expectancy is going up. At the same time, generally, fertility rates are falling.

The sum effect is that the older generation is growing in size and the number of people in the younger generation, the most economically active segment, is at best stable, sometimes even decreasing.

This worsening trend in what’s called the old age dependency (OAD) ratio - the number of seniors divided by the number of working people - is very worrying for society and for policymakers.

How should we continue to provide for citizens in their retirement in a way that is fair for everyone? What kind of pension system can best cope with big demographic changes?

It’s an almost universal problem and across mature economies the rate of change is more or less the same. In France and Germany, for every three active people there is now one retired person; in the UK and the U.S. it is not much better, more like 4:1.

We’re all headed in the same direction. In Germany and France, by the middle of the century there will be one retired person for every two “active” people if current trends persist; in Japan where it has already reached 2:1, the OAD ratio will eventually reach 1:1.

For countries that rely on a pay as you go (PAYG) pension system - whereby current workers finance current pensions - the status quo is clearly unsustainable without action.

If no action is taken, two options are possible: there will have to be an increase in the contributions of the economically active or, alternatively, a reduction in the level of benefits for retirees. Or maybe both.

Additionally, to further reduce the burden on the PAYG system the working age could be extended. All of these measures could stabilise the situation - but none will be very popular.

Longevity

Clearly, a standalone PAYG system is untenable in the long term, and future pension provision must have a funded element whereby individuals save for their own retirement in an invested fund.

It’s easier said than done, of course, and a funded system has its own risks. If pensions are completely market linked, a situation could arise where the market crashes (as happened in 2008), with obvious and serious implications for retirees.

Equally, there’s the issue of governance and the safeguarding of pension fund assets: It’s not unknown for a government to sequester monies intended for citizens’ pensions.

Personally, I believe that the multi-pillar approach favoured by the World Bank is a good model. It’s a combination of the PAYG and funded systems, but with an element of obligation on workers and/or employers in the private pillar.

The mandatory aspect takes account of the fact that while in many countries some industries have well-organised pension schemes, other parts of the economy do not. It’s the latter segment where the greatest need usually exists.

The life insurance industry can contribute a lot to making adequate pension systems more sustainable, providing a strong, funded pillar.

For old age income provision, security and reliability of income is paramount. The industry’s collective approach does more than enable it to assume longevity and mortality risks. Its collective approach to accumulating funds also has the effect of buffering volatility over time. In other words, the insurance industry’s collective approach provides exactly the stability needed for old age income.

I sometimes think that we as an industry do not talk enough about these unique selling points, but we should. Policymakers have to respond urgently to the demographic changes taking place and make pension systems fit for purpose. Let’s show them what we can do to help.

This is a summary of my presentation at the World Congress of Actuaries, June 2018 in Berlin.
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