Pension Situation and Impact of Reform on Russian and Non-Russian Regions Very Different

Paul Goble

            Staunton, July 8 – Moscow’s plan to raise pension ages at least in part is intended to reduce “the burden” workers have to carry for those who have retired from situation across the Russian Federation in which there are only about two workers for every retirees to one in which there will be three workers for everyone who draws a pension.

            But because the demographic situation in various parts of that country is so different, the size of pensioner “burden” on the working-age population and the impact of the proposed increase in the retirement ages are going to be different as well (rbc.ru/economics/05/07/2018/5b3b6c739a79475033464791 and onkavkaz.com/novosti/4557-dagestan-okazalsja-samym-molodym-regionom-rossii.html).

                In some predominantly ethnic Russian regions, because of low birthrates, outmigration, and shorter life expectancies, the “pensioner” burden is much greater than the all-Russian average; and in some places like Karelia, Arkhangelsk oblast and Tula oblast, it is closer to one pensioner for every worker, a relationship likely to be unsustainable.

            At the same time, however, in other non-Russian and especially Muslim republics in the North Caucasus with higher birthrates, the situation is very different.  The pensioner “burden” is already far less than Moscow’s goal of one pensioner to every three workers; instead, it is in some cases one for every four or even more workers. 

            The reform also has different consequences for regions depending on life expectancies. In some predominantly Russian regions, the share of the population that will live long enough to collect a pension if the retirement age is boosted is far smaller than in other Russian regions like the city of Moscow and than in some North Caucasus republics like Ingushetia.

            In addition, experts at the Institute of Demography of the Higher School of Economics, those areas with longer life expectancies, again like some in the North Caucasus, will continue to collect pensions longer than those, again in predominantly ethnic Russian and non-Russian regions in the Russian North. 

            Because pensions in Russia are a federal responsibility, there are few if any ways Moscow could adapt to these variations; but on an issue of such sensitivity, it is important to remember that the proposed pension reform will create at least in the minds of some new classes of winners and losers.

            To the extent that these follow ethnic, religious, or cultural lines, that could affect profoundly public attitudes and patterns of protest.