Russia Social Protection During Transition
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ReportNo. 11748-RU Russia Social Protection During Transition r and Beyond Public Disclosure Authorized (in two volumes) VolumeIt: Annexes February2, 1994 Human ResourcesDivision CountryDepartments Ill Europeand Central Asia Region FOR OFFICIALUSE ONLY Public Disclosure Authorized Public Disclosure Authorized Documentof theWorld Bank Public Disclosure Authorized Thisdocument has a restricteddistribution and may be used by recipients only in theperformance of their official duties. Its contents may not otherwise be disclosedwithout World Bank authorization FOROMCIAL USE ONLY RUSSIA: SOCIAL PROTECTIONDURING TRANSITION AND BEYOND Volume II Annex 1 Tables and graphs 1 Annex Z Wage and EmploymentDecisions in the Russian Economy An Analysis of Developmentsin 1992 13 Annex 3 The Role of Women in Rebuilding the Economy 76 Annex 4 Housing and Labor Market Distortionsin Russia 131 | This document has a restricted distributionand may beused by recipientsonly in th performance of their oMcal duties Its contents may not otherwise be disclosedwithout World Bankauthorization. .tmx 1 MacroeconomICTrends arel Figrs IB 70a - m-h 0114 onl SIll 0961 914 Quarter Vigur* Al 1 -J g.1~1011.10 ConsumerPrice Trmend Quarer F,re, 1 2 , 150goo 4t ) *V4 OV~~~0414 Quarter Figure *1.2 :1 Benefitsas a ftrcentage of GDP1992 . II £.3~~~~~44 4~~~~~~~~ Ilk"-AL1: R1ssian Federation: Distribution of Penioners as of Jamazy 1, 1993 (thousands) Cateory Labor p nioners 34,109 Old-age 28.538 Disability. 3.275 survivor 2,204 Social pensioners 961 Ivalids frau childhood 470 Disabillty pnsioners 60 Men above 65 and werno above 60 330 Childre u&o have lost a breadwinnr 20 Mlitary pensios 1160 Disability peioiner 140 Disability pensioners-war invalds s0 Survivor pnsiones 420 TOTAL 35,469 Ratio of pensioners to wozkforce .49 Source: Minitry of SociaL Protection,Pensios Fund. 3 Bo2Alx Eliilitv foA Panio,ns and DisOiliv Benafits Those eligible for old-age labor pensioa benefits must meet both the contribution MEd the age conditions. Contribution conditions require 20 qualifyitg years (25 for men), which incelude periodg of study, military service and maternity leave. for those with at least five qualifying years, a pension is paid ro rata, e.g. a woman is paid balf a pension after 10 qualifying -jears. pggenigngbLaAg is normally J5 for women and 60 for men. Sore groups (especially those working under hazardous conditiona) may receive their pension earlier and/or with shorter qualifying years. For example, teachers and certain types of artista (e.g. ballerinas) can retire provided only that they satisfy the contribution condition; miners in exceptionally difficult conditions can retire provided that they have contributed for 25 years an are aged 50 or over; mothers of at least five children, or of disabled ehildren become eligible for benefits witt1 15 qualifying years at age 50. Unemployed individuals within two years of pensionable age may receive tbeir pension without penalty. Eligibility for general disability benefits depend.i on (1) the degree of permanent physaial or mental disorder resulting in substantial loss of ability to worX, and (2) qualifying years of empioyment (up to 15 years), unless the individual became disabled when sbe was under 20 years of age. Thete are three groups of disability, defined as follows: Group I disabled suffer from .otal disabiUty and require, constant attendance; Group II suffer from total disability and are incapable of work; and Group UII suffer from partial disability. In theory, continuing eligibility for Group I disability is subject to teview every two years, and annually for Groups II and III unless the recipient is over pensionable age. Thare is no retirement condition for the Group III disabled. Neither the eligibllity review nor the retirement test for Groups I and Ir are rigorously enforced, however, as official statistics fox January .192 shoved that 6.6 percent of the Group I and 7 percent of the Group IX disabled receiving penaiens oontinuod to work. Iligibility for disability resulting frau work eceid.nts, aoecpatlisl disoease, or wAr* requires eertifioation of permanent aondition of total or partial incapacity -for work, wthout any qualifying year. of employment. Determination and classification of diaebility are'as for those dboe.` Surviver pensions are payable to non-working surviving dependents 0b0 (1) are either under n6e 18 -(o 23 -fot studeats).i disabled since childhood, over normal pensionable age, or giandparen-- without y * support; and (2) were dependent on the deceased as a permanent and prinoipal source of material -spot (waivedwhere cause of death was related to military service). There ars oontribution requirements as. fcr disability pensaon) for the deceased, except where cause of death is related to wrk or .i, service). Invalids of World War II are entitled to two old age-pensions. *~~~~~~~~~~~ Pension Benefit levels.,-; WA age. The old-age pension when first awarded is calculated as 55 perceat of tha indidual*s wage (either over the -previous 2 years, or over any -continuous 5-year petiod); plus 1 peyegnt of te ag base for each year of service over 20 (A5 for mmn) but bot e pera2$ . -receiving tae minimae pension receive -1percent of the minimumpension for each year of serviceaor 25 (25 for man). The benefit cnot- exceed 75 Percent of the Andivid4al's p wage- nor .3 inimumbenefit t3,5times for certain hazardous occupatics),. Disability. The basic benefit levels for Group I and Group II disability- rwar way as the-old-age pensiou. The Oroup I disabled also receives a suppleent for constanta (again, at two-thirds of the minimum pension). The Group In disability bonafit is lt at 9 , of tho tndividual's previous wage, and not leos than two-thirds of the minimum peaion.: isabled pensioners who reacb retirement age are eligible for retiremet -or disibilityeon wie higher. Levels of linimum and maximm benefits are same as for the old-age aension. - Survivor. Pensions payable to each offthe urvivIngdependens t 0percent of -thdceaed oto wage, for the maximum benefit under the old-age pension, whore death was related te r *zica,0iU£ - Pension Beft Levels---: ll tenpicsanrs can continue to work acciumlating pensions rigbts apd withbut a reduton n benefit 4cunts. ln early i99a,Z1.S percent- old-age pensioners wre -woring, *a wse"0+6 paoe: nt of disabled pensioners (general ot work-!related dsability) of all three groups 62.4 percent of roup If l disabiLity), and 11.1 Vertcent of tisabledmilitar pesioners. , vse amongndvils tirtwo years before the pensionable age becqee of redgundan,y,37.1 precentt:era eloya.i Peoe whebeta worked or live ina hadship .are, ha their wage-nd benefits ehanced' bye Z facl:tor ofi bewe 1 a ,e toee e-aled.sorthern coffiie ts, in 'ddition, to ay we a:pa tswia ' th a of ay cash benefit related to the previous w..e. 4 Table Al.2 RkQRNU AND IPNDITURS OP Tl RUSSIA PINSION FD (in billlon of rubles) ITEM 1Q. Budget 1993 2 of total |6. budget 2 of total 6m. 1993 Z of total REVENUES 1022.3 100.00 2642.9 100.00 3196.9 100.00 Insurancepayments by employersand 939.5 91.6 2560.1 96.9 2675.7 83.7 employees l Transfersfrom the Fed. Budget 82.82 8.1 82.82 3.1 87.64 2.7 other revenues' Carry-over from the previous year _ EXPENDITURES 930.45 100.00 2565.3 100.00 2430.4 100.00 Work-relatedpensions 895.58 91.3 2294.2 89.43 2238.6 92.1 Other expenditurese 5.4 0.2 Allowance for childrenunder < 1.5 Expenditureon federal funded 82.82 8.4 258.0 10.1 174.92 7.2 benefitse Operation costs' 2.05 0.2 13.05 0.51 11.48 0.45 Surplus/Deficit (-) 41.87 77.68 *t66.45 Debt repayment (with interest) Capitalization FINANCING (net bank borrowing I __________ __________ MDrRANDA' 34.5 Number of labor pensioners (mln.) No. of children under 1.5 (mln.) 7.3 Average Labor Pensi.n (r.mo) 14872 Effective employee contribution-PY 1./Includes penalties, self-employed, and interest. 2./Includes funeral benefits, early retirement, and pensions to those abroad. 3./As of 1 April 1992. this expenditure was shifted to the 8IF 4./See Table 2.5. The total budgeted expenditures were R. 87.66 billion for 1992. Includes military pensions, social pensions, various maternity and child allowances, and Chernobyl benefits. 5./Includes pension delivery, maintenance, and data base costs. 6./Includes0.75 billion rubles for information systems development. 7./The 1992 figures are based on the first quarter estimates. 5 ble AI13: Russian Federation Pension Fund Ezpenditures Paid for by Federal Bud8et (billiens of rubles) _ _. -. - ITEM 1991 1 1F 1992 S O 1 6 "SNTHS S OF ____________________________ ____________ TOM TOTAL 1993 TOTAL |-TOTALEXPENDISURES iS.88as lO00 7 80.49 100.0 156.7 1000 MiLitary pensionl 1.62 11 5 13.80 17.1 40.8 26#0, ocial pensions 0.95 | 06 |993 12.3 9.6 6 1 1 Family allowances 11.63 73.2 53.49 66.5 95 3| 60.8 Chernobylbenefits 0.00 0.0 3.27 4.1 11.0 7.0 Operatingexpenses 1.46 9.3 7.70 9.6 8.31 5.3 No. of military pensioners 0.85 0.85 1.13 (in millions) No. of social pensioners (in 0.47 0.88 .97 millions) No. of children between 1.5 9.20 10.70 9.2 and 6 (in millions) No. of single mothers (in 1.40 1.40 1.4 millions) Average social pension 168 312 9901 (rubles per month) I Average children's 95 175-200 2110.4 allowences Average single mother 71 154 2286.2 allowances10.=" _ = ml = = = * I Source: PF of the Russian Federation.