Pensioners Largest Problem for State Budget – and Kremlin Wants to Cut Their Number, Nalgin Says

Paul Goble

            Staunton, April 5 – The most serious problem the Russian state budget faces is not declining oil prices or corruption or sanctions, Andrey Nalgin says. Rather is it the increasing number of pensioners, a number that the Kremlin is doing everything it can to reduce not only by raising retirement ages but also by other means as well.

            This was confirmed four days ago, the economic analyst says, when the Vedomosti newspaper, citing a finance ministry document, reported that “the aging of the population of Russia remains the chief risk for budgetary expenditures despite the increase in the pension age” (vedomosti.ru/economics/articles/2019/04/01/797995-starenie-naselenie).

            Over the next 16 years, Nalgin says, the number of women under 55 and of men under 60 will decline by 2.7 million, with most of this fall off happening in the next five years. Over the same period, the number of Russians over those ages will increase by five million (a-nalgin.livejournal.com/1676886.html reposted at newizv.ru/news/economy/04-04-2019/sbrosit-ballast-kak-gosudarstvo-izbavlyaetsya-ot-starikov).

            Among the measures Russian officials are considering to change these trends, he says, are some taken from the practices of other countries and others dreamed up in Moscow. These strategies include making early retirement more difficult, a gradual reduction in social services for the elderly, and shifting health care to co-pay arrangements.

            The last involves limiting the access of the elderly to state-financed medical assistance. That idea came up two years ago, Nalgin says; but the Kremlin vetoed it because it was concerned about its ratings. Now, however, it isn’t – and so more moves in that direction can be expected this year.

            Given that most pensioners live from pension payment to pension payment now, few of them will be able to pay for such medical expenses. They will simply not be able to. As a result, they will suffer and die earlier, and the Russian regime’s budget problem will be eased by a reduction in the number of pensioners.

            “It is very difficult to call this initiative other than cannibalistic,” the analyst concludes.