Reliable securities – a way to a full-fledged launch of the accumulative pension system, – Ruslan Magomedov

This was emphasized by Chairman Ruslan Magomedov during an interview with Novyny.LIVE.

“From time to time, there appear statements that it is the NSSMC that is allegedly hindering pension reform. However, if you ask a simple question – who exactly is saying this and what are such statements based on – there is usually no clear answer. I communicate with the Minister of Social Policy and other authorities, and I have never heard that the Commission is a barrier to pension reform. Most often, this is a convenient explanation for complex systemic problems,” said the Chairman.

The problem itself is obvious: the solidarity pension system cannot cope with the load. Today, employed people support pensioners, but there is no guarantee that this model will provide them with a decent pension in the future. Therefore, the transition to a cumulative system is a matter of time. However, the key question is how these savings will work.

“The goal of pension funds is not to take risks, but to preserve the purchasing power of money. For example, if UAH 30 is enough for a cup of tea today, pension savings should ensure that the same cup can be bought in 20–30 years, regardless of the price in hryvnias. These are funds on which a person’s quality of life after retirement directly depends,” Ruslan Magomedov emphasized.

Pension funds are very fragile, so they cannot be invested in high-risk assets; they are supposed to grow at least at the rate of inflation.

“Pension reform directly depends on the development of the stock market. And when it starts working, “blue chips” will appear, i.e., shares of companies that have the most stable prices and demonstrate the best results on the market. Then it will be possible to invest pension funds there. Right now, we need clearly differentiated instruments: some for riskier investments, others for long-term savings, including pensions,” emphasized the Chairman of the NSSMC.

In this context, personal investment accounts (PIAs) play an important role, as they will be the starting point for the launch of the Stock Market 2.0 initiative. They will operate with a five-year horizon, while pension funds require 20, 30, and sometimes even 50 years. PIAs form a bridge between a shorter investment horizon and future pension savings. It is through them that the market will be able to demonstrate its ability to accumulate long-term funds and show its readiness to invest the money of pensioners.