A NEW PENSION AGENCY WILL EMERGE IN UKRAINE

Abstract

The reform of the Ukrainian economy, namely its transition from a planned, centralized, to a market economy and one that acts as a fully functioning functioning system in the world, requires the creation of a number of effective mechanisms of social protection for its citizens. In this context, the most important task facing the state is the issue of pension provision for citizens. In the last 30 years, social reforms have begun in many countries of the world, which are part of the reform of pension systems. The purpose of social and pension reforms is to increase the effectiveness of public social protection and social insurance, including ensuring the financial stability of compulsory social security funds and pension systems. The latter is necessary to protect future retirees from the rapid reduction of public pensions in the future.

The time when the state was fully responsible for solving virtually all social problems of its citizens has passed. As a result of the above-mentioned reforms, new types of state and non-state but public funds are emerging in the countries. These are compulsory social insurance funds of the population (which by their economic nature are so-called "solidarity" funds) and accumulative pension funds (which by their economic nature are so-called "savings" funds).

The need for effective regulation of relations regarding the formation, management, distribution and use of funds of new types of public funds requires clear resolution of many practical and theoretical problems, as well as the creation of appropriate new legislation.

It is noted that in order to restore an adequate level of pension provision in Ukraine, it is necessary to introduce a mandatory funded pension provision as an additional element of the pension system (the so-called second level), in order to form pension savings and increase the aggregate replacement rate as the main indicator of adequacy of pension payments.