Hr, billion euros
The officially employed population pays a unified social tax to support the elderly. The qualifying age is 60 for men and 57 for women, but the age will be set at 60 for both genders by 2021.
A persistent recession in the last two years has made it difficult to fund pensions, cutting gross domestic product nearly in half in dollar terms – from about $180 billion to just more than $94 billion expected next year.
According to the State Pension Fund, the average monthly pension across the country as of October was Hr 1,691 or about $70. With 42 percent inflation in the country, and benefits increasing by only 13 percent in September, the majority of the retired population are now losing ground.
Paltry pensions force the elderly into poverty or propel them back into the workforce or to rely on friends or relatives.
Ukraine spends around 15 percent of its GDP on its elderly, a high percentage among nations.
The nation also has one of the heaviest tax burdens on businesses. It is ranked 107th among 180 countries in the tax burden rating compiled by auditors PWC and the World Bank.
But these tax rates motivate many Ukrainians to avoid official employment or declare lower salaries, robbing the government and pension fund. Attempts to fix the pension system have stuttered for more than a decade as the nation ran up significant deficits in its pension system.
The Ukrainian government is now faced with a series of hard choices.
Lifelong monthly monetary
allowances for judges 1,407 recipients (Hr 16,634)
Average pension size Hr 1,692 The number of pension recipients 12.3 million
DisabilityDisabili pensions 1.4 millionmilli recipients (Hr, 1,456.)1,45
As part of a wider policy to delegate more authority and functions to regional and local governments, parliament voted to transfer almost all land and real estate powers from the State Architectural and Construction Inspectorate to municipal authorities. The central body has been left to oversee “significant objects” such as power stations.
Rights to a land plot and a construction permit can now be obtained in the same local department. The idea is to channel the bureaucracy to
Parliament’s decision to extend the moratorium on the sale of agricultural land until Jan. 1, 2017 disappointed many legal experts.
“It’s taken a lot of rights from owners who can’t sell their plots,” said Aleksandra Fedotova of Spenser & Kaufmann. “It’s all been made very political.”
Lifting the ban would mean that existing land owners and agricultural companies could use their land as collateral. But others argue that regulation should come first to assure the land is valued at market prices.
The Agriculture Ministry says it needed time, approximately a year, to prepare people for lifting the moratorium and in this way avoid “social tensions.” This includes drafting new legislation to allow regulators to oversee the sale of land.
“This isn’t the first time we’ve heard this. I understand that the land market law is important but it all depends on their intention and interest. Now they seem to be more interested,” Boichuk said.
“Many of my colleagues disagree but I am actually satisfied with the extension. I don’t feel we are really ready for this. We need to adopt proper legislation so that the land will be sold at market prices and villagers will be protected,” said Yuriy Zaremba, an associate at Avellum Partners.
Still, other changes such as the extension of the minimum agricultural land lease to seven years have made a difference to businesses. “They used to have to renew them every two or three years, now this has made things much easier…it means they can plan for crop rotation,” said Drobotskiy.