The so-called Soviet experience – the years officially worked out during the existence of the USSR – gives the right to additional interest on the pension. The Pension Fund of Russia (PFR) recently recalled this, stressing in its message that the increase for work before 1991 is calculated at the time of the appointment of a pension. Which of the Russians concerns this provision and on what additional sums in connection with the length of service they can count on, “MK” said the experts.
Not all interested persons may know about this, but the Pension Fund takes into account the labor activity that a person conducted back in Soviet times. “Soviet experience” gives older people the right to apply for an increase in monthly payments. The procedure for adding coefficients in the course of calculating the old-age pension is called valorization. It began to be carried out in our country 11 years ago. All residents of Russia, who by 2010 were pensioners, recalculated the existing pensions, adding money for the “Soviet experience” of work.
Pension fund specialists note that valorization is also imposed on those who are only now drawing up an insurance pension, having work experience in the Soviet years and not only. “Valorization implies an increase in the estimated pension capital by 10% for everyone who has work experience before 2002, as well as an additional 1% for each year of work experience until 1991,” the Pension Fund said in a statement.
Based on this formula, it is clear that if a person in the USSR worked, for example, 15 years, then 25% will be added to his estimated pension capital, of which 15% – for “Soviet experience” and 10% – for the period from 1991 to 2002 years.
As noted in the pension department, the maximum amount of the increase may be 6,338 rubles. Naturally, not all pensioners will receive the maximum cash payment, but only those who meet the criterion necessary for its issuance. In particular, a pensioner must have worked for at least 20 years during the existence of the USSR.
The citizens themselves need knowledge of this pension arithmetic only for control. The FIU calculates everything independently, based on official documents from employers. Moreover, all the years of his work without any restrictions go to the pension “piggy bank” of a particular citizen. And valorization applies to all insurance pensions without exception.
“In order for the pension to be recalculated, it is necessary to provide documents confirming the length of service in the USSR or after its collapse, but no later than 01.01.2002. The amount of the additional payment depends on the total length of service and is not the same for all pensioners, ”the Pension Fund explained.
When calculating the allowance, specialists take into account the length of service, the ratio of wages in the Soviet period to the national average, valorization, retirement points, indexation coefficient, and the pensioner’s rights to additional allowances. “Work activities carried out before 01.01.2002 are taken into account. The seniority period includes studies, military service and other periods. For the final calculation of the premium, a special complex formula is used, ”the FIU added.
Experts recommended confirming the length of service until 2002 on the basis of the original work record book, as well as certificates from the place of work. If the organization does not already exist, then the corresponding help can be requested from the archive. At the same time, the main documents that will be needed when registering the maximum possible pension: work book, employment contracts, orders for appointment to the position and payroll. Former military personnel will need to provide a military ID. Well, if a pensioner got a disability, worked in the Far North or in the countryside, or took care of a disabled relative, then documents proving this will be needed.
Mark GOYKHMAN, Chief Analyst at TeleTrade comments
“The words of the famous song“ My years are my wealth ”can be taken quite literally. For each year of work experience during the Soviet era, until 1991, the scrupulous Russian Pension Fund will add 1% to the pension capital. This provision applies to tens of millions of people who began their labor activity in the USSR. It must be documented. In most cases, this is reflected in work books, which in Soviet times were kept with very strict requirements. As for the subsequent years – from 1991 to 2001 – the FIU takes into account the difficulties with employment and confirmation of work experience during that period. Therefore, regardless of the availability of supporting documents, for the years 1991-2001, all people who have reached the retirement age are charged a pension supplement in the amount of 10%. Thus, the PFR “closes”, in terms of fulfilling pension obligations,
Natalia MILCHAKOVA, Deputy Head of IAC “Alpari”:
“The increase to the pension for the Soviet length of service applies to everyone who today receives a pension due to old age, disability or in the event of the loss of a breadwinner, provided that today’s pensioner had work experience until 2002, and not only in Soviet times, but also in transitional post-Soviet period up to 2002.
Today, the beneficiaries of such an additional payment are mainly pensioners who were born no later than the beginning of the 60s of the last century. In 2021, there were almost 42 million pensioners in Russia, and almost everyone who receives an old-age pension today had work experience until 2002. The so-called valorization, that is, an additional coefficient to the pension for Soviet work experience, increases the pension by 25%. Based on the average pension in Russia of 17,500 thousand rubles, such valorization can add an average of 4,375 rubles to the pension, increasing the average pension to 21,875 rubles, or almost $ 300. Not like in the European Union, of course, but higher than in the rest of the post-Soviet space.
The main plus of valorization is that such an increase can increase at least a little the standard of living of the majority of Russian pensioners. The downside is that the standard of living from it does not increase much by itself, and inflation and a weak ruble devalue the purchasing power of money, that is, the nominal increase from the state is then very quickly leveled by the growth of inflation. However, retirees are trying to help themselves by saving at least a little from the meager pensions to the bank for a deposit. Since interest rates on deposits are growing today, pensioners have a good opportunity to create a monetary “safety cushion” for themselves in case of crises and shocks in the economy. “
Andrey LOBODA, top manager in the field of financial communications:
“The pension theme today is a key trigger in the implementation of the country’s social policy. That is why any positive news on it is perceived as an important resonant event.
Citizens’ contributions to Soviet savings books were nullified by hyperinflation and the collapse of the socialist economy. The talks about compensation have been going on for several years, but all to no avail. It is surprising that the authorities decided to recall the Soviet work experience of our old people, this gives hope that sooner or later the 315 billion rubles burned out during the Soviet period will also be reimbursed.
In Russia, the formula for calculating a pension is still very complicated and you need to have an advanced level of knowledge in order to master it on your own. Citizens who have roughly worked for the USSR for at least 10-12 years can receive in addition to the Russian pension about 1200 rubles a month. This is a significant addition to the current inflationary reality and a clear signal about the expansion of the social agenda in the work of the government.
The concept of “valorization” (the establishment of additional coefficients when calculating the pension for seniority before 2002) is a very tricky one, and it is easy to use a smart word to cover up narrow points. Whether the FIU will be able to carry out calculations of the “Soviet experience” promptly and independently is a very big question. That country has long been gone, tens of thousands of enterprises and organizations have disappeared, in the district archives of small towns and villages in the 90s anything could have happened, including their physical disappearance. Therefore, if there is a request from the FIU to document the amount of salaries before 1991 and to officially confirm their insurance experience, then hardly any of the elderly will bring a certificate to such a request. In this case, it would be necessary to simplify the procedure and proceed from the fact of entries in the work book and average salaries in the branches of the RSFSR. “