Law on Co-Financing of Pension Savings in Force From October 1
The law on the co-financing of pension savings, providing public support to people in making the accumulative section of labour pensions, came into force in Russia on October 1, 2008.
"With the law, Russians will have the opportunity to decide whether they want to enter the voluntary pension system. From this date each citizen will be able to submit an application to their employer or to a Pension Fund office in order to have the right for making voluntary pension savings", the Minister of Health and Social Development of the Russian Federation, Tatiana GOLIKOVA, said at the meeting of the Presidium of the Russian Government.
Russians will be able to enter the voluntary pension insurance system between October 1st, 2008, and October 1st, 2013. "If people enter the system during the period, the government will co-finance their pension savings from the National Welfare Fund for ten years. The transferring of funds to accumulating accounts will begin in January 2009. The minimal annual contribution allowing a citizen to receive support of the state totals RUR 2,000, whereas the maximum public contribution amounts to RUR 12,000 a year. If a citizen reaches the pension age but continues working, the volume of public co-financing grows from RUR 12,000 to RUR 48,000", GOLIKOVA explained.
In addition, the law introduces incentives for employers that make voluntary payments for their employees.
"The pension fund is ready to start operations October 1. We have perfected the technological scheme for the receipt and processing of applications and are fully confident that no faults will occur", GOLIKOVA added.
