TRENDS IN THE FORMATION OF THE BUDGET OF THE PENSION FUND OF UKRAINE AND FACTORS OF INFLUENCE

Abstract

In the development of the pension system of Ukraine, there are a significant number of problems in the formation of income of the Pension Fund and budget balancing, which have become especially aggravated as a result of the difficult socio-economic situation, deterioration of demographic indicators and protracted economic stagnation, complicated by the COVID-19 pandemic. The article examines the features of the current stage of development of the pension system and its functioning. The activity of the Pension Fund of Ukraine as a basic institution in the field of pension provision was analyzed, the main trends in the formation of income and expenditure of the Fund’s budget in recent years was determined. On the basis of statistical data, a comparative and dynamic analysis of the main social and demographic indicators was made, positive and negative trends in socio-economic development and the possible factors that caused them were revealed. During research, the need to modernize the solidarity pension system was substantiated precisely in the direction of joint and several liabilities of employers and employees, by redistributing mandatory contributions to pension insurance between them. Implementation of the accumulative system of mandatory pension insurance is at least fifteen years late, and the experience of the freewill (non-state) pension insurance system, starting in 2004, turned out to be unexpectedly modest due to the lack of an investment culture in the country. This is a dangerous sign of conceptual miscalculations in the government’s program for reforming the pension system and may become a source of future crisis phenomena in both the social and economic spheres. The social, demographic and mental specifics of the country increase the disproportions in socio-economic development, and the absence of long-term targeted programs for state and interregional development only reduce the chances of Ukraine to build a modern innovative economy. In Ukraine, a chronically low level of citizens’ confidence in state institutions, including the pension system, as a result of which the level of persons covered by insurance of working age does not exceed 61%, while an indicator of 85% is required for a deficit-free balance of the Pension Fund. The need for a complex generalization of the world experience in the development of pension systems in the post-crisis period and its rational implementation in the domestic socio-economic realities were emphasized.