Today, at the plenary session of the Majilis of the RoK Parliament, the deputies of the House approved in the second reading the draft Law “On Introduction of Amendments and Additions to Some Legislative Acts of the Republic of Kazakhstan on Pension Provision”  the press service of the RoK Ministry of Health and Social Development informs.
This bill is designed to implement the main directions of the Concept of further modernization of the pension system of RoK till 2030, approved by the Presidential Decree dated 18 June 2014. 

The Draft Law provides for the following:

1. Changing the procedure for the assignment of basic pension payments.

It is suggested that, starting from 1 July 2017 the basic pension payment should be assigned depending on how long the person was a participant of the pension system when he/she reached the retirement age. With the length of participation of 10 years or less, the size of a basic pension payment will be equal to 50% of the living wage, being increased by 2% of the living wage for each full year above 10 years, but not to exceed the size of the living wage with a 35 years’ length of participation.

2. Introducing the new notional accumulating component of the pension system by establishing additional 5% obligatory pension contributions of the employer (hereinafter – OPCE).

These contributions are not deemed the property of individuals and will be fixed on the employee’s notional pension account opened in the UNPF.

The right to pension payments at the expense of OPCE will be granted to persons who have reached the retirement age, in whose name the notional pension account was opened, provided that OPCE were transferred for at least 60 months, as well as disabled persons of groups I and II who were recognized as permanently disabled.

The pension is paid for a lifetime by monthly payments and is not to be inherited. Each year, pensions will be indexed according to the financial capacity of the UNPF and demographic indices.

3. Improving the pension provision for separate categories of citizens.

It is proposed that, starting from January 1, 2016 all employees of the security forces should be fully transferred to the state pension provision.

The proposed measures will ensure that in the future, the ratio of the total pension to the average wage in the economy (wage replacement rate) is maintained at the level recommended by the International Labour Organization (no less than 40%).

The adoption of the bill is not expected to bring about any negative legal or social-economic consequences.