Increase in pensions for working pensioners in 2021

Indexation of pensions for working pensioners

Indexation for pensioners who receive a pension and continue to work has been canceled since January 2021.
Or rather, not about. The moratorium on increasing payments will last no less than until the end of 2021. And, most likely, it will be in force for another six years – until the end of 2024. During this period, the state plans to annually increase payments to non-working pensioners by an average of one thousand rubles. Indexation of pensions for working pensioners in 2021 and subsequent years has so far been recognized by the Government as inappropriate. Pension payments to working pensioners stopped being indexed due to the adoption of Federal Law No. 385-FZ of December 29, 2015. In particular, the document added a new article to the law “On Insurance Pensions” (No. 400-FZ dated December 28, 2013) – 26.1. It says that if a pensioner works, his pension is not indexed.

This means that its fixed (base) part does not grow. Previously, it increased in proportion to the level of growth in consumer prices over the previous year. Starting next year, the fixed part of the pension will begin to be increased at a rate faster than inflation - in accordance with Article 10 of Law No. 350-FZ of October 3, 2018, but only for non-working pensioners.

Indexation of pensions for workers in 2021 was not resumed for a number of reasons, including: was voiced by the head of the Ministry of Finance Anton Siluanov:

• Salaries, including those of working pensioners, are regularly growing, and faster than the pensions of non-working older people.
• A working pensioner has more financial benefits than a non-working pensioner. For example, he can take advantage of a tax deduction, returning part of the money paid in the form of taxes to the state treasury.
• Pensioners recalculate the amount of payment in case of dismissal, which adds a significant amount to it in case of loss of earnings. He begins to earn the same amount as his “colleagues” who did not previously work.

By freezing indexation for working pension recipients, the state also considered it fair to save funds from the Pension Fund in order to direct them towards a more significant increase in payments to non-working pensioners. After all, for them, as a rule, they are the only source of income.

The indexation carried out in 2021 is called the annual addition to the pensions of working citizens. As could be seen earlier, one should not expect a radical change in the size of pension payments. The study conducted by experts is noteworthy. In Moscow, you can buy 700 grams of stewed meat at a discount, 1 kg of chicken thighs or half a pack of dumplings for extra money.

In addition, pensioners can purchase 500 grams of cervelat or 400 grams of doctor's sausage. The head of the Ministry of Finance, Anton Siluanov, points out that wages are growing in the Russian Federation, and working pensioners are the owners of a number of benefits, and therefore special attention is not paid to the bonus.

Many pensioners ask where they can go and whether there is a need to write an application and collect a package of documents. The answer is clear - no, nothing is needed. Re-indexing occurs automatically, this is done by Pension Fund employees, there is no need to submit documents or fill out forms.

The authorities indicate that a working pensioner can find out what the size of his pension will be after dismissal. In this case, a link is made to the Pension Fund website. After the pensioner resigns, the employer submits the necessary information to the Pension Fund. After this, the procedure for recalculating pension payments begins and lasts for 3 months.

We draw your attention to the fact that pension recalculation is carried out without an application, questionnaires and documents. Even if a citizen resigns, the pension is recalculated based on the information submitted by the employer to the Pension Fund.

Current legislation does not provide for cases of self-submission of an application for recalculation of a pension, calculation of the number of pension points, or notice of dismissal.

There are no restrictions in calculating pension supplements in current legislation. All features of indexation were discussed earlier; they relate to the number of pension points. Thus, the maximum number of pension points is reduced to three. At the same time, the maximum amount of the supplement is 261 rubles 72 kopecks.

Increasing pensions for working pensioners from August 1, 2021

From August 1, all pensioners who are currently working will receive an increase in their pension. This information was received from the Pension Fund. Pension indexation applies to all pensioners for whom insurance contributions to the Pension Fund were received from employers in 2021.

As of August 1, 2021, the value of one point is 87.24 rubles. The earlier a citizen of the Russian Federation retired, the smaller the increase in pension payment will be. The Pension Fund budget set aside 10.6 billion rubles, which will be used to pay pension supplements.

Due to the “freezing” of planned indexation of pensions for working pensioners from 2021, an increase for them is made only as a result of an annual recalculation in August. The government does not plan to further restore the process of indexation of payments to working citizens, as this will require additional costs of 250 billion rubles annually. Therefore, the August recalculation is now the only mechanism for increasing pension provision for this category of citizens.

Unlike standard indexations (an increase in payments by the same percentage for all citizens), the additional payment during recalculation is determined individually. The size of the increase depends on the number of contributions to the pension insurance system (PIS) that the employer paid for such an employee. Thus, increased payments are due to citizens who carry out official labor activities.

To receive an increase in pension, you do not need to apply to the Pension Fund, since all data on the citizen’s work activity is already available in their accounting system:

1. Data on employment is received by the Pension Fund of the Russian Federation from the employer in monthly reporting.
2. Information on the payment of pension insurance contributions from self-employed citizens (individual entrepreneurs, lawyers, notaries, etc.) comes from the tax office. If such a citizen ceases his activities, the Federal Tax Service will notify the Pension Fund that the pensioner is no longer working (accordingly, he goes into the category of non-working).

The August recalculation takes into account contributions that were paid to the compulsory pension system in the past year. This means that when calculating the increase in August 2021, contributions that were paid as a result of work in 2021 will be taken into account (if they were not taken into account earlier when assigning a pension).

As already noted, an increase in pensions from August 1, 2021 is provided only to working pensioners. Recalculation is made in relation to the following types of insurance pensions:

• by old age;
• on disability;
• for the loss of a breadwinner (if at the time of payment, insurance premiums were not taken into account in full).
  Recalculation of the insurance pension for the loss of a breadwinner is carried out only once - in August of the year following the year of assignment of this type of pension. This means that the increase in 2021 is due to citizens who received payment in 2021.

When determining the amount of the increase, the following features are taken into account:

1. The increase is carried out as a result of taking into account the pension points generated over the past year, that is, the amount of the additional payment depends on the amount of contributions paid to the pension insurance system. Consequently, the increase is affected by the level of wages in this period - the higher the official earnings in 2021, the more deductions were made and pension points generated.
2. However, when calculating the increase from August 1, not all generated individual pension coefficients (IPC) are taken into account - their number is limited to 3 pension points.
3. Since indexation for working pensioners was frozen in 2016, the cost of 1 IPC is not indexed for them. This means that the recalculation will take into account the value of the pension coefficient established on the date of registration of pension payments. For a pensioner, this means that the increase in August 2021 will be smaller, the earlier he retired.

Since the cost of 1 pension coefficient for 2021 was set at 81.49 rubles, the increase in August 2021 is expected to be no more than 244.47 rubles. (equivalent to 3 IPC).

For comparison: to earn three pension points for a full year of work, a pensioner’s salary must be about 20 thousand rubles. per month.

State Duma on increasing pensions from August 2021, what amount

From August 1, all pensioners who are currently working will receive an increase in their pension. This information was received from the Pension Fund. Pension indexation applies to all pensioners for whom insurance contributions to the Pension Fund were received from employers in 2021.

The current legislation of the Russian Federation regulates that the pensions of working pensioners can increase by no more than 3 points.

As of August 1, 2021, the value of one point is 87.24 rubles. The earlier a citizen of the Russian Federation retired, the smaller the increase in pension payment will be. The Pension Fund budget set aside 10.6 billion rubles, which will be used to pay pension supplements.

What can retirees expect next year?

So, there will be no indexation of pensions for working pensioners in 2021. In particular, this category of citizens will not be affected by the increase in the insurance pension by approximately 1,000 rubles, promised by the authorities in January. Their pension payment will be indexed only if they quit their job within the next year. Then, after about three months, its size will be recalculated, including all indexations that took place during the “freezing” period.

In addition, it should be taken into account: despite the fact that indexation of pensions for working pensioners is not provided, the amount of pension payments will still be increased. But this will not be the result of pension indexation, but of its recalculation in connection with the accumulation of new pension coefficients (points).

This means that while the pensioner is working, his employer pays monthly insurance premiums for him. Based on the total amount contributed during the previous year, the employee receives pension points that have a certain value. It is regularly revised upward. For example, the cost of a pension point in 2021 is 81.49 rubles, and next year it will increase to 87.24 rubles.

However, there is a restriction for working pensioners - they are allowed to accumulate no more than 3 points over the previous year. Thus, by multiplying them by 87.24, you can find out the maximum possible increase in pension for working pensioners next year. It will be 261.72 rubles (87.24 x 3).

The Pension Fund recalculates the pensions of pensioners who continue to work once a year - on August 1.

Information that Russia wants to abolish pensions for working pensioners has been officially denied. Government officials emphasize that such a decision would violate citizens’ guarantees for pensions due to age, illness and other circumstances, enshrined in Art. 39 of the Constitution of the Russian Federation.

There is always a way out

Even though the government does not plan to make additional payments to working pensioners in 2021, there is always a way out. Every citizen of the Russian Federation who has retired but continues to work can independently increase the amount of payments. In order to do this, a person only needs to make insurance contributions. However, it is worth remembering that contributions made last year will only be taken into account in the current year, and so on. It should also be remembered that an increase in pensions can only be made on the first of August of this year, since the recalculation of payments is carried out on this very day. And, of course, pensioners will not be able to receive at least a thousand rubles more, since the maximum amount of the bonus is 250 rubles. Actually, this is why many pensioners simply do not think about this increase and are content with little, so as not to waste time over a quarter of a thousand rubles.

Will there be another increase in pensions in 2020?

First of all, the amount of the supplement to pension payments depends on the citizen’s salary during 2021. To be more precise, the size of the increase depends on the amount of insurance contributions paid by the employer to the Pension Fund. The number of points awarded depends on this. Percentages are not used when calculating the amount of pension increases.

The peculiarity of the pension points system is focused on an individual approach to each citizen. There is no equalization system, everything depends on the size of wages.

In order to calculate the maximum amount of the pension supplement, it is necessary to set the maximum number and value of one point. Based on this, we calculate the maximum amount of the increase in pension by multiplying 87.24 rubles by 3.

Consequently, he receives 261 rubles 72 kopecks.

Note that in order to receive three pension points, the salary must be at least 20 thousand rubles.

Looking ahead, pension payments in 2021 could increase by about 6.6%. At the same time, the size of the pension point will increase from 87 rubles to 93. Such data is contained in the Main characteristics of the Pension Fund budget; they are predictable and not accurate. In addition, in 2021, the cost of a pension point will increase to 98 rubles 86 kopecks, in 2022 - by 104 rubles 69 kopecks.

How do you feel about the ongoing re-indexation of pensions of working citizens?

As already noted, the increase in August 2021 is carried out by increasing the number of pension points in the previous year, which are formed as a result of deductions of insurance contributions. Since non-working pensioners no longer make contributions to the pension insurance system, the amount of payments to them in August will not increase.

All insurance contributions for the period of work of non-working pensioners were taken into account in full when assigning them a pension. If for some reason any non-insurance periods were not taken into account, or there are other grounds for revising the amount of payments, then the Pension Fund resolves such issues by individual recalculation.

Thus, all plans for indexing pensions for non-working pensioners have been implemented in accordance with the law, so the next increase for this category of persons is planned only in 2020. The Government plans to carry out indexation for them annually from January 1, increasing the amount of payments

on average by 1000 rubles every year

, which will ultimately provide

the average pension by 2024 is 20 thousand rubles

.

In some cases, non-working pensioners also have the right to increase their pension payments as a result of recalculation. If there are reasons for this provided by law, the pensioner can contact the Pension Fund with supporting documents and a corresponding application indicating the basis for recalculation, for example:

• The number of disabled citizens who are dependent on pensioners has changed. In this case, an additional payment for dependents will be made to the fixed payment in the appropriate amount.
• The pensioner moved to the Far North region (or to an area equivalent to the KS region). In this case, the fixed payment will be increased by the regional coefficient, which corresponds to the region of residence.
• The category of recipient of a survivor's pension has changed (for example, a person receiving payments for the loss of one parent has also lost the second). In this regard, the amount of the fixed payment will also be increased.
• When assigning an insurance pension, non-insurance periods were not taken into account (for example, the period of military service, caring for a child up to one and a half years old, caring for a disabled person of the 1st group, etc.). As a result of such recalculation, additional pension points will be awarded and the pension amount will be increased.

In addition to the request-free recalculation in August, working pensioners can receive an increase in their pension in the following cases:

• When moving to the Far North region or an area equivalent to it. In this case, the payment will be increased by the regional coefficient established in the region.
• With an increase in the number of dependents. For each disabled family member supported by a pensioner, he is entitled to an increase of 1/3 of the fixed payment to the insurance pension (you can read more in the article at the link).
• When developing the necessary experience to receive the “northern” bonus. If a pensioner has 15 years of experience in the Far North or 20 years in the ISS, then he is entitled to an increase of 50% of the fixed payment.
• As a result of recalculation for “non-insurance periods”. During these periods, insurance contributions are not received by the Pension Fund, however, their duration is subject to credit towards the length of service. Such periods include: military service;
• child care leave up to 1.5 years;
• the period of caring for a disabled citizen: an 80-year-old pensioner or a disabled person of group 1, and so on.

For all the above reasons, recalculation is carried out only at the request of the pensioner. To receive the appropriate additional payments, you will need to contact the Pension Fund branch and provide supporting documents.

How will indexing be carried out?

First, let's make a small explanation. Indexation of pensions is a regular increase in the size of social benefits. This is done in order to level out the depreciation of the purchasing power of money due to inflation. Let us add that the amount of indexation is determined by the increase in prices for certain categories of goods.

Here you need to understand that indexation invariably affects the salaries of public sector employees, student scholarships, and other social benefits and payments.

Indexing stages

In 2021, pensions were increased as follows:

1. The insurance pension increased by 7.05% from January 1, 2021. Based on this increase, an increase in pension of 1,000 rubles was promised. Let us clarify that such an increase is not a fixed amount, and the actual amount depends on the size of the pension received. For example, if a person receives 8,500 rubles, they added 595 rubles;
2. Social payments. This category includes benefits, one-time cash payments and other subsidies. Indexation was carried out on February 1, 2021, and the growth of this type of income was 4.3%;
3. Social pension. As mentioned above, such pensions are received by citizens who have failed to earn the required number of pension points and insurance coverage. Indexation of this type of pension content occurred on April 1, the increase was 2%.

Let us clarify that after indexation, the average size of the insurance pension in the country was 15,430 rubles . Please note that starting from January, the cost of a pension point will increase to 87.24 rubles.

The amount of indexation in 2021 will be known later.

Indexation of pensions for working pensioners

As noted above, indexation of pensions for this category of citizens does not provide for an increase in the amount of pension benefits.
The country's president has repeatedly stated that this issue is under consideration, but for now the moratorium introduced in 2021 continues to apply. The following reasons were voiced by the head of the Ministry of Finance as grounds for refusal:

1. Stable increase in the level of income of the working part of the population;
2. Regular increase in wages, which generally exceeds the ongoing indexation of pensions;
3. Guaranteed recalculation after termination of employment.

Note that, despite the lack of indexation, working pensioners fit into the government’s general concept of increasing the well-being of older people. After all, the incomes of these citizens grow along with the increase in wages.

Who will have their pensions increased from August 1, 2019?

Starting from 2021, only the increase in pensions from August 1 for working pensioners has been preserved. It is held annually. It does not matter what type of security the citizen receives: insurance or social. The procedure is regulated by Article 18 of Federal Law No. 400 of December 28, 2013. It determines who will have their pension increased in August.

In order to find out the amount of the bonus, you first need to determine the number of points earned by a citizen over the past year. But here it is important to note that the maximum number of IPCs for recalculation is limited to 3 points. The resulting value is multiplied by the cost of the IPC established at the time the pensioner retires.

If a citizen retired in 2021, then determining the amount of the maximum allowance for him is: 3 * 78.28 rubles. = 234.84 rub.

Let's look at a specific example of how pensions are recalculated in August 2021 for working pensioners. Let us remind you that indexation has been frozen since 2021.

Vitaly Borisovich retired in January 2021. He was assigned insurance coverage in the amount of 12,500 rubles. The man decided to continue his work and did not quit. His monthly salary is 20,000 rubles.

Since Vitaly Borisovich works, he is not entitled to indexation in January, but the citizen has the right to a pension increase in August. Recalculation is carried out as follows:

1. Let's determine how much the pension will be increased by initially calculating the number of points earned by a man for 2021:
   the amount of insurance premiums will be: 20,000 * 16% * 12 = 38,400 rubles;
2. the maximum possible amount of contributions to the Pension Fund is: 1,021,000 rubles. (maximum base for calculating insurance premiums for 2021) * 16% = 163,360 rubles;
3. number of IPK: (38,400 / 163,360) * 10 = 2.35 points.
4. The size of the supplement will be: 2.35 * 81.49 rubles. = 191.5 rub.
5. The amount of security after recalculation will be equal to: 12,500,191.5 = 12,691.5 rubles.

Now let's see how much Vitaly Borisovich's monthly payment would increase if he had the right to indexation.

In 2021, the increase in insurance pensions was carried out on January 1, the percentage increase was 7.05%. Accordingly, after the specified date, the amount of security would be equal to: 12,500 7.05% = 13,381.25 rubles, that is, the increase is 881.25 rubles.

We get 881.25 rubles versus 191.5 rubles.

As can be seen from the example, indexation is more profitable than recalculation. But as the citizen continues to work, the total income of the citizen is higher.

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What is “pension recalculation”

According to clause 3, part 2, art. 18 of Law No. 400-FZ of December 28, 2013 “On Insurance Pensions”, a pensioner has the right to recalculation if his IPC has increased due to additional insurance contributions not previously taken into account in the payment amount. In fact, this norm applies to pensioners who continue to work and make contributions to the Pension Fund.

Recalculation is an accounting of those pension points that were formed after retirement and were not taken into account previously. In fact, this means that the amount of the payment will take into account the points accumulated over the past year - that is, in 2021 the points for 2021 will be counted, in 2021 - for 2021, and so on.