Nazarbayev returns pension reform draft to parliament

Nursultan Nazarbayev has returned the pension reform draft to the Parliament, Tengrinews.kz reports. “I has been following the public discussions that accompanied the whole process of the draft's preparation, discussion (in the parliament) and voting. I am familiar with all the arguments of opponents and supporters of the new law. I have to say that unification of the retirement age for men and women has been the most heatedly discussed issue. I believe that clumsy actions of the Government and the National Bank should bear come of the blame for that. This important social draft law has been promoted like a regular legislative act and not like an essential and vital measure that guarantees wellbeing of the nation and efficiency of the national pension system in the long run,” the President said. According to Nazarbayev, the government and the Labor Ministry failed to successfully represent the draft law in public discussions and assert its importance in the people’s minds. “As a result, a majority of Kazakhstan citizens are cautious about the retirement reform and do not understand its essence. Speaking in general, I believe that the government and the National Bank have failed to explain the new pension legislation to the people. It is obvious evident that the changes in the pension legislation are necessary! This is a global trend,” the President said. He referred to countries of Europe and other parts of the world where the authorities had to change the legislation amid the crisis and the approaching recession. “Only modernization of the pension legislation can provide reliable guarantees of wellbeing to all the retired people in Kazakhstan. The savings system will be efficient in the long term perspective only in this case. Only this can rid our society of a crisis of the pension system with the government being unable to provide pensions to people like it happened back in the 1990s when retired people in Kazakhstan were receiving no pension payments for months in a row and those they did receive were pitifully small,” he said. Speaking of the disputed draft law, the President said that a forecast deficit of funds for payment of pensions was the main argument for raising the retirement age for women. The deficit is explained by ageing of the country’s population, growth of the life expectancy and the fact that women will make 70 percent of the retired persons. “The budget expenses on pension payments will grow by 3 trillion tenge ($20 billion) without the gradual raise of the retirement age for women. This will become a problem for the future pensioners whom the government will be unable to provide for. We have to solve this issue now. The common retirement age for men and women is normal for most of the developed countries. For example, the retirement age for men and women is several European countries is 67. Many countries are now taking similar decisions as an unavoidable measure amid the global crisis,” the President said. According to him, Kazakhstan government timely initiated the gradual transition to a higher retirement age for women. But instead of convincing those who will directly experience the changes, the government and the National Bank hurled all their efforts on convincing members of the parliament. “Understanding the importance of this decision for people, the Majilis and the Senate have adopted this new pension legislation package, which was the right decision, because many of the law’s regulations are necessary for improvement of the living condition of our people. That’s why I am generally supportive of this draft law. But at the same time I believe that not all the aspects of the pension system’s reform have been thought through well enough. Executing the authority vested on me by the Constitutions, I am recommitting the draft to the parliament for revision of and voting on the timeframe of the raise of retirement age for women. I suggest starting the gradual raise not from January 1, 2014 but from January 1, 2018. This will make the modernization of the pension system fully compliant with the interests of the people of Kazakhstan,” the President said. Earlier the Kazakhstan Senate approved the draft law On the pension system in Kazakhstan and the accompanying draft law On amendments to certain legislative acts on the pension system in Kazakhstan in the first reading. The results of the voting for the draft law were as follows: 36 senators voted for, 4 against and 2 senators abstained from the voting. Deputies Gani Kassymov and Svetlana Dzhalmagambetova expressed their disagreement with the draft law. The law on modernization of the pension system provides from creation of the Common Pension Fund, unification of the retirement age for men and women, introduction of compulsory professional retirement payments, elimination of employment discrimination, support in employment of people over 55, introduction of preferences for retired women and support to elderly village residents. It stipulates a gradual raise of the retirement age for women from 58 to 63 during 10 years. By Renat Tashkinbayev