Without budget funding pensions will have to be cut almost threefold. Nina Kozlova’s comment toNezavisimaya Gazeta

The pension system of Russia cannot become self-sufficient and still depends on federal budget funding. Moreover, according to auditors’ data, this dependence has increased over the recent two years. Auditors say that population’s contributions cover only 68% of all payments on insurance pensions: last-year contributions amounted to circa 4 trillion rubles, whereas actual pension payments required about 6 trillion rubles.

Nina Kozlova

General Director of FinExpertiza

The funding of the Pension Fund of the Russian Federation with insurance contributions is related chiefly to the current demographic situation. The share of population above the working age is rising every year. Thus, if in 2005 this share was 20%, in 2017 it grew up to25%. The number of the working age people was reduced by the same amount, therefore, so did the insurance contributions from their salaries.

Pension coverage is probably the most important social aspect of the government policy. In this relation, whatever the pension fund deficit, the difference in receipts and payments will always be settled by federal budget funds.

Should there be no backing on the part of the government, pensions could indeed be three times as low as they are.