Pension in Belarus. How seniority and contributions affect its size, explained in the FSZN

On the air of the program “Skazhinemolchi” on the TV channel “Belarus 1”, the first deputy manager of the Social Protection Fund of the Population of the Ministry of Labor and Social Protection of the Republic of Belarus Ekaterina Likhacheva spoke about the mechanisms of professional pension insurance and explained that seniority or salary is more important for future pension. It's from sb.by.

- Occupational pension insurance is a mechanism for supporting employees employed in special (heavy and harmful) working conditions. Not all citizens can apply for it, but only those whose work is associated with increased loads and risks. Such categories include, for example, pilots, miners, gas-electric welders, as well as certain categories of pedagogical and medical workers. For these specialists, a separate payment of contributions is provided, due to which a “second” pension is formed. Employees can receive payments either within the framework of professional insurance or in the form of an additional pension, explained the guest of the studio. – In parallel, another direction is developing in the country – voluntary funded pension insurance. It is available to every working citizen and allows you to independently form additional pension savings.

Ekaterina Likhacheva told what should be a “quality” pension:

- This is a payment that allows a person to maintain the same standard of living when he retires. Its task is to provide coverage for basic needs and leave room for personal expenses and small financial bonuses.

When asked how seniority and contributions affect pensions, she stressed:

- There are two main mechanisms of pension formation in Belarus. The first is the labor pension (mandatory system). Women go to it at 58 years, men at 63 years. Important condition: for the right to a labor pension, you must have at least 20 years of insurance experience, that is, 20 years with the payment of contributions to the FSZN. The second is voluntary insurance, an additional tool by which a person helps himself to save for a second pension. The size of the labor pension is directly affected by the duration of the insurance period. 20 years is the minimum threshold for retirement. The more experience in excess of this minimum, the higher the coefficient and, accordingly, the total amount of payments. There are other advantages of insurance experience: it gives the right to pay sick leave. Thus, employees with experience of more than 10 years sick leave from the first day is paid in the amount of 100% of earnings (instead of 80%). Explaining the importance of “transparent” employment, the First Deputy Governor of the FSZN noted:

- The earlier a person begins formal employment, the better for his future pension. It is important that the employment was transparent: informal part-time work is not taken into account in the calculation of pensions, because they are not paid contributions to the FSZN. Separately, it is worth noting the work under a contract: for such periods, contributions to the FSZN are paid, but it is better to consider them as additional income or part-time work, and not as the main source of formation of pension rights. It is also important to take into account that the month of insurance experience is counted only if contributions are paid from income not lower than the minimum wage. If the amount of contributions is lower, the month will be considered incomplete.

The speaker also explained that the seniority or salary with which contributions are paid is more important for the future pension:

- Both are important, because if there is a small experience, for example, 20 years, and a large salary, then the size of the pension may be the same as a person with a large insurance experience and a lower salary. These are the two factors that shape future pensions.