In Ukraine, 'labor pensions' were abolished: what did pensioners receive instead.

Ukraine has conducted a major reform of pension legislation

Significant changes have taken place in Ukraine's social security system due to pension legislation reform. One of the key points was the complete shift from the concept of 'labor pensions' to an insurance model.

Before the reform, which took place in 2004, Ukrainian pensioners received payments under a branched system of labor pensions. This system included various directions: age pensions, disability pensions, payments in case of loss of a breadwinner, and service pensions. There was also a category of social pensions for individuals who did not accumulate the necessary work experience.

A key moment in the history of pension provision was the adoption of Law No. 1058-IV on July 9, 2003, which came into force in 2004. This law fundamentally changed the existing system. The result of the reform was the creation of a new structure of pension payments from three basic categories: age pensions, disability pensions, and pensions in case of loss of a breadwinner. The main difference in the new system is that the size of pension payments depends on the amount of insurance contributions.

Experts emphasize the importance for current pensioners to understand that their pension provision is formed based on insurance contributions and not previous work experience. This requires citizens to pay closer attention to the process of forming their future pension and timely payment of insurance contributions.

Thus, the updated pension legislation of Ukraine corresponds to global trends in transitioning to an insurance model of pension provision, making the system more transparent and fair.

Pension indexation: good news for Ukrainian pensioners

The government of Ukraine promises to conduct a pension indexation in the spring of 2025, which could lead to an increase in pensions by almost 17%.