Maxim Topilin — RBC: “it is Wrong to consider the pension system deficit”

Labor Minister Maxim Topilin told RBC, do we need reform of the pension system what to do with low unemployment benefits and how the authorities are going to fight against informal labour market

— All concerned about the fate of the Russian pension system. Many experts are talking about the necessity of raising the retirement age. But in February you said that “the time has not yet come”. When you think a time will come, and will come at all? Isn’t it time to take seriously the problem of imbalances in the pension system?

We still must proceed from some assumptions. Say: “Here, there is a need to solve such and such problem”. But unless the population is knocking at the door and says: “Increase retirement age”? Some groups, young people, that you yourself require? You think we should raise the retirement age? Do you think the demand from the society for this?

Request from the society, probably not.

— I understand that if the youth said, “We analyzed, we understand that, if this is not done, we are left without a pension at all”. But it is not. In the question you refer to some experts. But let us think: who’s the expert? A community of professional certified exams took? Or just called: it expert on pension issues, and is an expert on the organization of work of the psycho-neurological boarding schools? If something wrote “Ivanov, Petrov, Sidorov”, which the professional community is not recognized as experts, their opinion should be considered or not? We have so many so-called experts who do not understand the subject matter.

But many such experts after all, guided by some objective data, at least from the point of view of state Finance.

— If you talk to the experts who are preparing proposals for pension reforms, they will tell you: “we Have no data we can’t in the Pension Fund to obtain detailed data. Give us access to the personalized accounting”. I assure you that even the majority recognized experts great shortage of relevant data. To maintaining individual records it is impossible to give access is personal data on them, we can give only aggregated information.

As for scarcity, as you said, the pension system… I keep trying to explain that there are transfers to the Pension Fund due to the fact that the FIU performs under retirement functions: administers, for example, maternity capital, various payments, such as regional social supplements to pensions or co-financing regional programs for construction of social institutions. By and large it is not the function of the Pension Fund, but we need a statement that funds will be communicated to the population, the RPF does.

There are transfers that are associated with the fact that the government has decided that some employers will pay in off-budget state funds less than others. For example, let’s decide on areas of priority development: set the rate of insurance contributions 22% and 6%. In addition, under the legislation, the rate to the Pension Fund is 26%, but every year the government extends the benefit, and determines the rate of 22%. That is, the employers instead of 26% — the rate that must provide pension rights, paid 22%, and this is a minus of almost 500 billion rubles in the annual security pension system. Established preferential tariffs in Tori (priority development areas. — RBC), in the free economic zones, small business for the IT industry. But pensions in the solidarity system need to pay today. So when we make a decision about the benefits, it automatically transfer. If there were no benefits, there would be no transfer to the Pension Fund, there would be no imbalance.

The debate about the retirement age

The Finance Ministry has proposed to raise the retirement age to 65 years for men and women (currently, men can retire at 60 years, women — 55 years), reported in April of last year, RBC. The Agency wanted to increase gradually — from 6 to 12 months a year. According to the Ministry of Finance, in favor of increasing the retirement age speaks a multitude of economic, social and demographic factors. In particular, this need is caused by the fact that the average life expectancy is only since 1995 has increased by 5.2 years for women and seven for men. The current retirement age in Russia was installed in 1932.

Alternatives to raising the retirement age in Russia, says the head of the Center for strategic research (involved in the writing program of economic reform), ex-Finance Minister Alexei Kudrin. He proposes to raise the retirement age to 63 years for men and women, stretching is an increase of 8-15 years.

— You want to say that the primary pension system — that is, without these additional functions the FIU — is not scarce?

— Is not. If you remove all transfers that are not associated with the payment of pensions, and transfers for benefits, you will see that there are no transfers. Ensure all insurance premiums. That is, if we didn’t make the decision for preferential rates, allowances to Soviet pensioners (valorisation. — RBC), preferential amounts fixed payments to separate categories of citizens, adopted a decision on withdrawal of early retirement pensions from compulsory pension provision, we would not be transfers.

To say that the pension system deficit, profoundly true. It is scarce only because of our decisions. The deficit in the Pension Fund itself. It is not something that retirees more than working, or demographics, or something else — it arises solely by virtue of the provisions of the law. Here, many do not realize, including some experts.

But the state last year, for example, was not able to fully index pensions…

— Funds for the indexation are formed when real wage increases, so inflation is quite low and the deductions from wages are rising faster than inflation. And it was all the previous years up to 2015. We February 1, indexed pensions to inflation and April 1 condensible on the income of the Pension Fund (law on insurance pensions provides for the possibility of additional indexation of pensions, if the growth of incomes PFR exceeds inflation. — RBC) at 0.5, 2, 3% — for as long as the Pension Fund has received insurance premiums. How he got so many and sent to retirees.

In 2015 first appeared the gap when income growth to have fallen short of inflation. So I had to take some money out of the Federal budget. When I first received the so called inflationary transfer. This transfer is small, only here we can talk about that there is a net aid budget. Next thing you know, in 2016, had to index pensions only 4% (compared with inflation of 12.9%. — RBC). But at the same time, the government has decided to support the incomes of pensioners in January of this year to all pensioners, and working and non-working, were transferred lump sum in 5 thousand rubles. By the FIUs it took 221,7 billion rubles from the Federal budget. Last year, a law was passed by which the total material maintenance of the pensioner in 2017 cannot be less than received in the previous year.

Photo: Vladislav Shatilo / RBC

“Benefits on insurance premiums should not be”

— Do you think that benefits for insurance premiums must not be?

— Benefits in the insurance rates can not be in principle. Insurance systems are built in such a way that benefits shouldn’t be. You have the benefits of insurance?

— No.

Because in the head no one would not come. The insurance company you did not say that if you have two children, you put the benefits. All spelled out in the insurance system: the machine with such engine, your driving experience, your violations. In our insurance system as well: if the employer has harmful jobs, it pays a premium to the insurance rate. If the citizen have no proven work experience of 15 years, so he will not enter the pension system will not receive an insurance pension, and social, which is below the insurance.

In CTP there is no such thing in any free economic zone, all released is even impossible to imagine. And on insurance premiums in the same insurance system, why that is. It is theoretically incorrect. In the long-term development strategy of the pension system recorded that it is necessary to leave benefits. But we understand that once we have these rules of the game are announced, they cannot be changed dramatically. By virtue of the law, these benefits are temporary. The Ministry of labor proposes, first, not to accept new solutions at reduced rates and, secondly, not to extend their expiration date.

Finance FIU

In 2016 the income of the Pension Fund amounted to 7.6 trillion rubles, follows from the operational report of the Federal Treasury. However, only slightly more than half of their income, the FIU received from paying the Russians insurance premiums — 4,14 trillion RUB More of 3.36 trillion rubles of the budget of the Fund was transfers from the Federal budget. Among these transfers, the revenue shortfall FIU from lower insurance premiums in some sectors of the economy. In 2016, the amount of such shortfall in income amounted to 392 billion RUB.

The revenue part of the budget of the FIU in 2017 was approved in the amount of 8.36 trillion rubles, the deficit is expected to be 220,4 bln RUB (connected with formation of means for financing of funded pensions). The total amount of transfers from the Federal budget this year will amount to 3.8 trillion rubles, is said in the law about the budget of the Fund. Budget revenue shortfall FIU from reduced insurance premiums in 2017 will be nearly 434 billion rubles, specified in the law on the Federal budget for 2017.

— Well, in your opinion, benefits should be removed. But in General, what to do with the level of insurance deductions? The Finance Ministry claims that we have too high a financial burden on labor, which we are losing competitiveness. Are you ready to reduce them?

— Are you willing to go to pensioners, to the grandmother and ask, “Grandma, do not too much you have a pension?” You’re asking me. The pension Fund is formed by insurance contributions and transfers, which go from the budget. That this funding allows us today to achieve an average pension of 13 thousand. You’re essentially saying: “Not much if we take from the employer, taking into account all benefits to provide a pension?” I think not much. Because the amount of the pension is very small — 13 thousand, in 2017, expect about 14 thousand rubles.

Say: “Let’s reduce the rate if the economy will grow?” And suddenly you grow up? This solution was adopted in 2005: the rate was 28%, made 20%. I thought that the economy will grow. But increased transfers from the budget. Prior to 2005, transfers in the Pension Fund were not, the pension system was self-sufficient.

“Why should we pay 850 rubles., if the people are in the informal sector?”

Let’s now turn to unemployment benefits. A few years did not change their size. Last year the labour Ministry has proposed a bill, which proposed almost doubling the benefit, at the expense of more targeted purposes and by limiting the number of recipients. What with the fate of this bill?

— The bill now douglasbeauty, including with the Ministry of Finance and the Ministry of justice. We believe that by reallocating existing funds, and that about 40 billion rubles per year, we can increase benefits to those who lost their jobs, for example, on reduction, and those who have a 12-month period before applying to the employment service were earnings within six months. Increase is possible, if you stop to pay a minimum allowance of 850 rubles to those who no longer works or never worked.

The bill still has a number of elements associated with re-registration as unemployed. There are citizens who are removed from the register when the payment period has expired, after some time again become a and get the minimum payment. To avoid this, be amended. Of course, the unemployed will still be able to use the basic services of the employment service to apply for temporary or permanent work, to undergo vocational training.

The resistance to this bill is?

— Categorically against unions RTK (the Russian trilateral Commission for regulating social-labour relations. — RBC) — they think it’s infringement. Offers a more rigid system, but it seems to me more fair: after all, resources should be directed to those who really looking for work right after her loss and is looking for as quickly as possible.

— State Duma deputies have expressed concern that with the increase in benefits will increase the number of “dependents” and there will be a situation in which the burden of payment even for the budget increase.

— The Ministry of Finance is afraid of just what you say, how you can raise the allowance, so as not to get a very strong influx of applying for it. We are trying to consider. We seek a consensus without it we would not be able to go to the state Duma. Recently, we have not made any decisions in terms of when the trade Union side strongly opposed, and we go ahead…

I think the bill is important from the point of view of the possibility of increasing the amount of the allowance, but simply to restore order. Why do we pay 850 rubles., if the people are in the informal sector? In addition, the regions have mechanisms for providing social assistance — you can contact local social protection if there are no revenues. Only it is not necessary to use the channel of unemployment, if you are looking for a job.

— Us unemployment benefit is a form of social assistance and it is the expenditure side of the budget. And in many countries this part of the insurance system that is financed by a specific source. This model in our conditions real?

— In the future — Yes. Most of the countries you rightly pointed out, live in the insurance system. And unemployment insurance we had until 2001. Again, it is the subject of discussion with business and trade unions. The unions are definitely “in”. But the question is what to set the rate? It should not be large. We thought he might be about 1%. By the way, this type of insurance would be to pack the item associated with the payment of wage arrears to workers of bankrupt companies. Non-payment of wages, when there is no bankruptcy estate, remains an unresolved problem.

— The benefits would be higher than current?

— 1% of insurance premiums payroll is about 200 billion rubles And we have the only benefits 40 billion is spent.

— And when there can be a transition to a model of unemployment insurance?

— I think that beyond 2020-2022 years. About a theoretical construct, no one questions. Employers, at least those who are with us in partnership, participate in the work of the RTC believes that the insurance model of security of the citizens in the event of loss of work is more correct than the existing one. But the question is where to find this proportion so as to allow substitution of Federal money, which now go for benefits, insurance money.

“It is not fair when some pay nothing into the pot, but at the same time, use clinics, schools, kindergartens”

— Many recipients at the same time are employed in the informal sector. The Finance Ministry proposes to deal with informal labor market by reducing insurance premiums. What alternative offers the Ministry of labor?

In 2015, we conducted extensive work to determine how many citizens of working age not working who are not received the premiums. The study showed that excluding pensioners, students, large families, invalids, military and equated such people is 15 million, we Have such tools in the fight against the informal employment, as a fee to reduce the informal labour market on the level of regions and field audit in respect of particular employers, in which participate including tax and labour inspectors. For the last two years managed to legalize 4.5 million workers — they were signed labor contracts. Moreover, we are tracked on the basis of the Pension Fund, are contributions for these workers — that is, not if they’ve gone again into the shadows. Work on legalization of the shadow of the labour market allowed us to collect in two years, more than 27.4 billion RUB premiums.

— And this year plan to do in this area? For example, media wrote a lot about the “tax on parasitism”…

This year we set ourselves the task to find the possible schemes of money laundering. We believe that the citizen has hidden income can choose the most convenient method of legalization. This may be payment in the state off-budget funds — the pension Fund and HIF — or something else; while I think. Discussions are underway at the level of the Ministry of labor. We will connect economists and tax specialists. But no bills, for example, “the tax on spongers”, as the payment called media, currently no.

In Germany, or in Finland, or in France, you can not, once out of work, to sit and nothing to think. The questions arise involving, for example, with health insurance, someone must pay. We have, unfortunately, this legislation does not dokruchennaya to the end. Hence, there is the opportunity to work in the grey sector and nothing to worry about. So gradually we come to what we must create — we say, Yes, uncomfortable conditions for those who considers it possible to live in society and be free from it. It’s not fair that some pay nothing into the pot, but at the same time, use clinics, schools, kindergartens. It turns out that all of these services for them and their pensions and other social security is provided for those who work officially.

The tax on spongers

In 2016, about the necessity of the tax for able-bodied, but never officially employed, said Deputy Minister Dmitry Peskov, who said that such a document is developed by the Ministry and its goal is the legalization of the labor market. Information in September 2016 confirmed by Deputy Prime Minister Olga Golodets, who noted that the tax will be levied on those of working age Russians for the use of social infrastructure. The Minister Maxim Topilin noted that the Ministry does not develop a bill, but only to discuss such an idea. Against the initiative of the Ministry of labour organized by the Ministry of economic development and the Ministry of health introduction of regional tax on non-working citizens supported. “Tax parasites” implemented in Belarus, where in February 2017 citizens because of this collection came to the protest.

“If you do not solve the issue of regionalization of the minimum wage, to equate it to a living wage will be impossible”

— For a long time at the state level, the task of adjustment of the minimum wage (SMIC) and the minimum subsistence level. Judging by the dynamics of increasing the minimum wage, the adjustment in the short term. When this wait?

— The story of the adjustment of the minimum wage and the subsistence minimum has been dragging on for 16 years, since the adoption in 2001 of the Labour code, where it was recorded that the obligation of the state. Set the minimum wage equal to the Federal cost of living unsustainable, because the cost of living in every region of the. In Ingushetia or Bryansk region it is 8-9 thousand rubles, and Chukotka — 18 thousand If we set the minimum wage at subsistence level, the national average, in some regions the cost of labor is overstated. Although if it is to say to trade unions, they will answer: “Yes there is!” And should be done differently: the minimum wage we need to make de facto regional, it must be equal to the subsistence minimum in each region.

— We need the money for equalization. This regions will be required to pay for the adjustment or it remains the obligation of the Federal government?

— Everything will be as it is today. If we are talking about a Federal institution, then the adjustment will meet the Federal budget. If the regional institution, the regional budget. If on private enterprise, it means employer.

Now the ratio of minimum wage to a living wage by nearly 70%. We propose to adopt a law according to which all will know that during such a period, in such date the minimum wage should be gradually increased. Than ever employers are unhappy? The fact that, for example, in may adopted a law that from 1 July the minimum wage increased by a certain percentage, and they can’t predict and prepare for the changes, which unexpectedly increase costs. Therefore, we propose to negotiate at the Federal level with all partners clear about the range of adjustment of the minimum wage and a living wage: let’s say, from July 1, 2018, the ratio should be 80% from 1 July 2019 — 90% from 1 July 2020 — 100%.

Photo: Vladislav Shatilo / RBC

But regional authorities, especially in the North, I am afraid that, if the obligation to equalize the minimum wage and the subsistence minimum will give to the regions, they will lose the Northern allowances, and this is a significant budget item.

— A living wage reflects everything and rates, and ratios. What is the district factor? This is what is reflected in the prices. But we don’t touch regional coefficients. To appease our social partners and regions, we have prepared an explanation, which clearly States: not permitted reduction of Northern allowances, regional factors and the General level of wages in connection with a possible change in the structure of the minimum wage. Our proposal concerns only the minimum wage and timetable of the adjustment the cost of living. If you do not solve the issue of regionalization of the minimum wage, we equate the minimum wage to a living wage will be impossible.

— It is only your position or the consolidated opinion of the government?

We discussed this issue with the Ministry of economic development and the Finance Ministry. We have endorsed bills on minimum wage because we are still working with partners, trying to explain our position. But fundamental disagreements with the Federal agencies there. Except that the Treasury may say, well, let’s just slightly move the schedule adjustment. And employers may be asked to conduct adjustment, for example, by 2021, and 2022-mu. Employers can insist on a softer pace of adjustment, and the unions — more stringent.

“Why, if the strike will be 20 or 30 percent of the workforce, the remaining employees have to suffer?”

Experts from the Center for economic and social reform constantly state increase the number of labor conflicts. The labour Inspectorate is now able to respond adequately to assist employees in their relations with employers, if there are any conflicts? Or still need, maybe, to reform the institution.

— We track the conflicts. The Fes and the Federation of independent trade unions of Russia are monitored continuously. According to Fes, in the past year, there were 116 protests, including 13 strikes. The unions give some additional preliminary numbers — 167 social and labor conflicts. The main cause of — full-payment of wages (41%). Next come the reduction or dismissal of employees — 13%, decrease in level of payment of labour — 11%, liquidation of the enterprises — 8%.

The number of labour inspectors is not that big. Indeed, it is not always possible to respond quickly to treatment, especially because a lot of them: the sense of justice of our citizens is growing and with it grows and the number of complaints.

Including why we now turn to the so-called risk-oriented supervision. Recently released government decree, according to which the labour Inspectorate will be included in the list of those Supervisory authorities that are moving to risk-focused technologies. This means that the work of inspection should be based on the risks that need to predict and prevent.

— And how will it help inspection? They do not have more resources.

— Launched new schemes of work that allow Rostruda to save resources. For example, the website “Onlinespecial.of the Russian Federation” the employer can pass the self-test. The Fes allocates the so-called interrogatories for checks that are easy to fill. 2013 held 185,9 thousand checks. This technology reduces the time inspectors and for employers it is an opportunity to avoid penalties. The evaluation of the Fes, employers that have eliminated identified during the self-test violations, to protect themselves from fines by 4.4 billion rubles.

The Fes was revising outdated regulations involving inspections. There are acts, even dated 1925, which still apply to the employer for execution. But these norms in the Russian legislation is long gone, so developed by a government decree, to be issued in the near future, it cancels more than 50 Soviet normative acts in the labour sphere. This is done in order not to burden the employer with unnecessary paperwork and that it has not imposed sanctions for failure to comply with outdated regulations. And, of course, this will have an impact on the time of the audit.

Another challenge is that the inspector had an electronic verification program that does not allow him to deviate from tasks. Indeed, in practice, as it happens, some saw the law, a normative act is remembered and made claims, and it is necessary that the inspector was within his test, clear list of documents. And the email program will not allow him beyond the check out. The introduction of checklists in the work of labour inspectors is planned for this year.

— Think about what you need, especially in times of crisis, to allow workers to legally strike, so they can splash out their negativity?

— In my opinion, Russia is acceptable the design of the entrance to strike. The strike may be, when it insists most of the team. Why, if the strike will be 20 or 30 percent of the workforce, the remaining 70% of the employees have to suffer? Some call for a solidarity strike, and on what basis? There is a conflict at a particular company — why should anyone join it? Such topics are thrown by some organizations, including political. We to them are very wary. Serious proposals on simplification of procedure of a strike, we have not received, there is only talk. We must not forget that the strike is a last resort when resolving a collective labor dispute. The legislation establishes a number of mandatory conciliation procedures prior to strike action.

— And itself conflicts at the enterprises has increased in the last time or not?

— I would not say. In 2016, there were signs of increasing conflicts, mainly due to growth of wage arrears. Overall last year the majority of conflicts (94%) resulted in full or partial satisfaction of employees.

One of the trends 2016 — reducing the average duration of socio-labor conflicts compared to last year, including because of non-payment of wages. Over the past year thanks to the intervention of labour inspectors 958 thousand employees received a total of 22.9 billion RUB delayed wages and due compensation

— And this year, problems with debt, no? In Transbaikalia, for example, until recently it was very dysfunctional, if you look at the salaries of the same teachers.

— According to Rosstat, in 2016 the debt of the country declined by almost 0.9 billion RUB from us But it doesn’t. We will improve the legislation — is the order of the Prime Minister we have. By April 15 we need to prepare relevant proposals. As for the Baikal region, the issue is solved. I have several times per month communicate on this subject with the Governor, and such a situation as was last year, in 2017 should not be.

Maxim Topilin was born in 1967. He studied at the Moscow Institute of national economy. G. V. Plekhanov. Since 1988 working in the research Institute of labour, 1994, in the government of the Russian Federation. In 2001 Prime Minister Mikhail Kasyanov has appointed Topilin Deputy Minister of labour and social development. In 2004, appointed head of newly created subordinated to the Ministry on — the Fes. In 2005 Prime Minister Mikhail Fradkov has appointed Topilin chief state inspector of labour, and in 2008-appointed back to the Ministry of health and social development, as Deputy Minister. In 2012 Topilin was appointed head of the Ministry of labour and social protection of the Russian Federation.

With the participation of Svetlana Bocharova

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