Reason Why Belarus Has Such Low Pensions Revealed

Only three-quarters of funds of the Social Protection Fund go to the pensions.

According to the law "On the budget of the state extra-budgetary fund of social protection of population of the Republic of Belarus for 2017", it is planned to allocate only 76,7% of the fund for payment of pensions in the future. The remaining funds will go for other social benefits, select.by reports.

The incomes of the Social Protection Fund of the Republic of Belarus in 2017 should amount to BYN 12,68 billion in total. The majority of this are individuals making contributions to the state social insurance – BYN 11,98 billion. Non-tax revenues amount to only BYN 0,28 billion.

Meanwhile, it is planned to allocate BYN 9,65 billion for the payment of the labor and social pensions, as well as military pensions and the provision for the payment of pensions services, which makes only 80,6% of the funds transferred to the Social Protection Fund by individuals.

As for the payment of pensions to foreign citizens in the Republic of Belarus and Belarusian citizens who went abroad, BYN 0,074 billion will be allocated on that in 2017, which makes only 0,6% of the revenues of the pension fund.

As for the payment of additional professional pensions for insured persons reaching the general retirement age in 2017, it will be only 0,03% of the pension fund.

These numbers illustrate why Belarus has such low pensions. If all the money from the Social Protection Fund had gone for the payment of pensions, they would have been approximately 20% higher. Thus, working citizens of Belarus will actually transfer not 35% of the social insurance, but only 28,4%. The remaining 6,6% is actually an additional income tax, which is used to repay some of the social costs of the state.

These are, basically, the following expenses: payment of benefits for temporary disability, maternity, family benefits, temporary disability benefits for childcare, benefits for disabled of group I or the persons who have reached 80 years of age, and for funerals. BYN 2,85 billion will go for these purposes in 2017.

All the other expenditure items of the Fund remain insignificant. For example, to finance measures in the field of employment, they allocated only BYN 38 million, and to finance the sanitary-resort treatment and recuperation - BYN 36,3 million.