This year, the Social Fund will increase the contributory pensions by 17.3%. This coefficient was based on the results of pension savings investment, which at the end of last year exceeded the inflation rate (5.6%) by more than three times. The Fund's staff will adjust the amounts in an application-free format starting August 1, raising the payments for around 136,000 people.
The hike will also affect participants in the pension savings co-funding program, parents who directed maternity capital toward their pension, and those who accumulated savings independently outside the co-funding program. For these retirees, payments will grow at an even higher rate than for recipients of contributory pensions: by 19.3%. According to preliminary data, the increase will affect 37,300 people.
The total amount needed for the adjustment will stand at RUB 8.5 billion.
Note that the absolute majority of Russians receive their funded payments along with their old-age pensions. The average contributory pension currently stands at RUB 1,600 per month, while the average size of a fixed-term pension payment (for those with voluntary contributions) is RUB 3,000.
Under the current rules, funded pension adjustment happen annually from August 1 on, provided there is a positive investment income for the past year. The corresponding procedure is established by the federal law on funded pensions.
Today, pension savings investments for clients of the Social Fund is managed by VEB.RF, a government-owned managing company, as well as 9 private managing companies. Together they offer 13 portfolios to invest their money into.