“Advanced growth policy”: Putin announced a 10% increase in the minimum wage, living wage and pensions

Russian President Vladimir Putin proposed to further increase the amount of pensions in the country.

With such an initiative, the head of state addressed the participants of the meeting of the Presidium of the State Council on Social Issues on Wednesday, May 25.

“We discussed this with the government for a long time, there were disputes within the government and a solution was worked out.

Today I want to announce this: I propose to increase the amount of pensions for non-working pensioners by 10% from June 1 of this year, taking into account our legislation, ”Putin said.

As the Russian leader recalled, since January 1, 2022, the insurance pensions of non-working citizens have already been indexed by 8.6%.

Thus, the increase in the amount of payments compared to the level of 2021 will be 19.5%, which is higher than the inflation rate, Putin stressed.

In total, indexation should affect 35 million non-working pensioners, which was announced during the meeting by Russian Minister of Labor and Social Protection Anton Kotyakov.

According to him, the national average pension will increase by 1,760 rubles - up to 19,360 rubles.

“Of course, the size of the increase will be calculated personally for each citizen.

The Pension Fund will start delivering pensions, taking into account indexation, from June 3, ”added Kotyakov.

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In addition, from June 1, the living wage will be increased by 10% in Russia.

On average in the country, it will grow by 1,265 rubles - up to 13,919 rubles.

As Vladimir Putin noted, the initiative should lead to an increase in the part of social benefits and payments, which will become an additional help for many families with children.

The head of state also proposed to index the minimum wage (minimum wage) by 10%.

As expected, the amount will increase by 1,389 rubles - up to 15,279 rubles.

“In general, we need to consistently pursue a policy of outpacing wage growth relative to the increase in the cost of living.

Our main task is to ensure a further increase in the minimum wage so that the level of income of citizens significantly exceeds the subsistence level,” the President said.

Along with this, the Russian leader instructed to double the allowances for female servicemen to care for a child up to one and a half years.

From July 1, the amount of such payments should exceed 31 thousand rubles.

“This has nothing to do with the operation, it just happened: female servicemen are not included in the insurance system, so there was a fixed payment, they are paid a little more than 15 thousand rubles to care for a child up to one and a half years ... such an injustice must be eliminated ", Putin explained.

According to the Ministry of Finance, the initiatives proposed by the president will cost the federal budget 600 billion rubles in 2022 and another 1 trillion rubles in 2023.

The head of department Anton Siluanov spoke about this at the meeting.

At the same time, the country's leadership today has every financial opportunity to fulfill its obligations to citizens, Svetlana Bessarab, a member of the State Duma Committee on Labor, Social Policy and Veterans Affairs, told RT.

“The budget is now running with a surplus.

The government has calculated the appropriate norms for payments.

In any case, all social obligations and guarantees that the state assumes will be fulfilled in full and on time,” Bessarab emphasized.

According to her, the lower house of parliament plans to consider the president's proposals in the near future.

At the same time, the deputy did not rule out the possibility of introducing additional measures to support citizens this year.

“Let me remind you that in 2021, when many Russians had financial difficulties due to the consequences of the pandemic, the government provided assistance through lump sum payments to various categories of citizens, including families with children.

I think that this practice can be continued this year, if circumstances so require, ”said the RT interlocutor.

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The indexation of social benefits proposed by the president should partly compensate citizens for the rise in inflation.

This, in turn, will revive consumer demand and thereby support economic activity in the country, says Georgy Ostapkovich, director of the Center for Market Research at the Institute for Statistical Research and the Economics of Knowledge at the National Research University Higher School of Economics.

“The indexation of benefits is designed to help low-income people maintain their usual lifestyle so that people can buy food and non-food items.

At the same time, maintaining demand has a positive effect on the economy: enterprises begin to produce more goods and services, adjusting to growing consumer activity,” Ostapkovich explained.

Better than expected

On the whole, according to Vladimir Putin, the dynamics of the Russian economy are now better than some experts predicted.

So, for example, the unemployment rate has dropped to 4%, the dollar is “shrinking” against the background of the strengthening of the ruble, and inflation has begun to slow down, the president noted.

According to the latest estimates by Rosstat and the Ministry of Economic Development, from May 14 to May 20, consumer prices for goods and services in Russia fell by an average of 0.02%.

This has happened for the first time since August 2021.

At the same time, back in early March, against the backdrop of large-scale Western sanctions against Moscow, prices in the country grew by about 2% weekly.

The overall annual inflation rate in Russia is still high and currently stands at around 17.5%.

However, according to the president, by the end of the current year, the value may drop to 15%.

In the context of a difficult economic situation, back in early March, the authorities set the task of ensuring a reduction in the level of poverty by the end of the year, Putin recalled.

The President noted that difficulties are being observed today in many countries, but at the same time he called on the Russian leadership to do everything possible to achieve the goal.

“As for social issues in general, there are, of course, a lot of daily tasks that need to be paid daily attention to on the ground in each region.

But along with this, we must always look to the future, one step ahead and build our work based on the priorities that have already been identified.

And our key and invariable priority is the growth of the well-being and quality of life of citizens,” the President stressed.