August 21, 2018
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Vladimir Putin accused of using World Cup to bury bad news after raising pension age on opening nightVladimir Putin’s government has been criticised for using the World Cup to bury bad news after it announced a rise in the pension age in the wake of Russia’s first victory of the tournament.  The announcement, which came immediately after Russia’s 5-0 victory over Saudi Arabia on Thursday evening, is likely to prove widely unpopular among the Russian public, who opinion polls show are deeply opposed to adjustments to the welfare state.  Dmitry Medvedev, the prime minister, said the proposed adjustments to the law would see the pension age for men raised from 60 to 65 and for women from 55 to 63.  There will also be an two percent increase on VAT from 18 to 20 percent.  Alexei Kudrin, a former finance minister widely seen as a leader of the liberal economic camp in the Kremlin elite, welcomed the news.  Пенсионная реформа назрела давно. Наконец, решение принято. Это выгодное для граждан решение, оно позволит повысить пенсии— Алексей Кудрин (@Aleksei_Kudrin) June 14, 2018 “Pension reform is long overdue. Finally, the decision has been made. This is an advantageous solution for our citizens, it will increase pensions,” he wrote on Twitter. But the announcement drew a critical reception from some Russian papers, with some columnists suggesting the whole point of the World Cup was to distract the public while the government launched painful economic policies.  Moskovsky Komsomolets, a pro-Kremlin tabloid, noted that the plans had been announced without prior discussion, despite previous promises that such an unpopular move would be the subject of public debate.  The announcement came as millions of Russians were watching the World Cup opening ceremony Credit: MLADEN ANTONOV/AFP Maxim Topilin, the minister of labour, said the measures would be discussed with trade unions and employers. Opposition figures mocked the way Mr Medvedev made the announcement while Mr Putin presided over a footballing victory, in an apparent bid to distance the president from unpopular measures.  "Putin is actually in favour of lowering the retirement age. And increasing pensions. And cutting the price of petrol. But Medvedv and Kudrin have conspired and are plotting," wrote Leonid Volkov, an advisor to the opposition leader Alexei Navalny.  Economists have been urging Mr Putin to launch far-reaching but painful economic reforms for nearly a decade, but he has previously resisted such advice because of the danger of a public backlash. A recent opinion poll published by state media showed that 92 percent of Russians oppose pension reform. Mr Putin built much of his political brand on a social contract which guaranteed jobs and pension security for much of the population.  Millions of pensioners rely on Russia's welfare state Credit:  Stanislav Krasilnikov/Tass Mr Medvedev said actual pension ages would be raised gradually at a rate of 6 months per year, meaning the retirement age of 65 for men will be reached in 2028 and 63 for women in 2034. The state-owned Gazprombank said in a note to clients that the reform is one of the most gradual scenarios the government had considered and that it might only bring in 25 to 30 percent of the savings it is theoretically meant to achieve.  Russia's state pension fund is running a deficit equivalent to around 3.1 percent of GDP. 


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