Indexation of pensions in Russia in 2022: how pensioners’ incomes will grow

Indexation of pensions in Russia will be about 7% - every year for the next three years

Indexation of pensions in Russia will be about 7% – every year for the next three years

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twenty five thousand rubles – this will be the average pension in Russia in 2025 year. Such a forecast is contained in the draft budget of the Pension Fund, which was at the disposal of RBC. As suggested in Ministry of Labor, pension will increase every year above the rate of inflation. But we are talking only about non-working pensioners.

In autumn, the Ministry of Finance submits to the State Duma the budget for the next year and the next three years. In the summer, all departments make forecasts and submit these projects to the Ministry of Finance. The government can either approve or correct them.

The indexation of pensions according to the law is carried out at a level not lower than inflation, but retroactively. For example, if in 2021 prices increased by 8.5%, then from the beginning 2022 pensions were raised by 8.6%. It is planned to do the same in the future.

The Ministry of Economic Development and the Central Bank believe that inflation this year is unlikely to exceed 17%. Prices have been falling for the fifth week in a row. And this trend is likely to continue until the end of the summer. Deflation will be stimulated by seasonal factors – cheaper fruits and vegetables.

From July 1, pensions for the unemployed pensioners upfront will increase by 10%. To compensate for the rise in prices, which was in the spring. And at the beginning of next year, the authorities will add another 6.8%. So you get the desired 17%.

In subsequent years, growth will be about the same (see chart). But these are all approximate figures. By the end of each year, real indexation will be adjusted according to actual inflation. In order not to break the law and accurately compensate for the rise in prices.

PS Recall that the annual indexation applies only to non-working pensioners. Employees are entitled to only a small increase in August, which depends on their salary and accumulated points for the year. In addition, she has a ceiling. For example, this year the increase for working pensioners will not exceed 356 rubles.

How will pensions grow in the coming years?

Year, indexation and amount (thousand rubles)

2023 +6.8% 22.2

2024 +6.1% 23.4

2025 +7.6%* 25.2

* Indexing this year is planned to be carried out twice – in February and April. This was before the pension reform. They want to return to him.

Source – draft budget of the Pension Fund for 2023-2025.

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