Accumulation Pension Funds: condition and development

Theoretical aspects of accumulation pension system. Analysis of current status and development of accumulative pension system in Kazakhstan. Ways to improve the pension system and enhancing its social significance accumulative pension fund provision.
Краткое сожержание материала:

Размещено на

THE MINISTRY OF EDUCATION AND SCIENCE OF REPUBLIC OF KAZAKHSTAN

International Academy of Business

DEPARTMENT "FINANCE "

COURCE PROJECT

On the discipline «FINANCE»

On theme:

Accumulation Pension Funds: condition and development

Student of II course, group F1102, specialty finance

Utegenova Altynay

Scientific leader:

the Associate Professor

Omarova A. Sh. DBA

ALMATY 2012



Content

Introduction

Chapter 1.Theoretical aspects of accumulation pension system:

1.1 Economic essence of pensions.

1.2 Stages of formation of accumulative pension system in the Republic of Kazakhstan

Chapter 2.Analysis of current status and development of accumulative pension system in Kazakhstan

2.1 Structure of accumulation pension system

2.2 Pension saving depositors

Chapter 3. Ways to improve the pension system and enhancing its social significance accumulative pension fund provision

3.1 Solutions of problems of accumulative pension system8

3.2. Key areas for improving the accumulative pension funds

Conclusion

The list of literature

Appendix



Introduction

The modern practice of state regulation of social and economic development of the country necessitates transition to formation of long-term targets of the pension system. Pension provision in the Republic of Kazakhstan is a leader in the social protection system, and affects the interests of more than 1.6 million pensioners and about eight million members funded pension system. Its qualitative and quantitative characteristics indicate the level of social, economic, legal and cultural development of society. The structure and functioning of the pension system in many ways determine the stability and dynamics of economic and social development of the country. An effective system of pensions, their timely payment support favorable social climate. Kazakhstan Government get the task to strengthen the social orientation by reforms, which strengthening its efforts to reduce unemployment and poverty, creation of conditions for the implementation of the labor potential, timely payment of wages, pensions, and social assistance to the poor. The aim is to improve the social climate in the country.

In the message of President of Kazakhstan to the people: “Strategy of entering Kazakhstan to the number of 50 most competitive countries in the world” from 1st March, 2006 Nazarbaev noticed that "... we are building a socially oriented society ...". The transformation of the socio - political system, the transition to a market economy required a fundamental change in the state policy in the field of social security. And since 1997 Kazakhstan is reform pension system because the existing system, based on the principle of solidarity between generations, is exhausted its potential.

And the first step to solving this problem was the Law "On Pension Provision in the Republic of Kazakhstan", which was adopted on 20 June 1997. "This Act establishes the legal and social aspects of pensions in the Republic of Kazakhstan, regulates the participation of government bodies, individuals and legal entities, independent from forms of ownership, in the realization of the constitutional right to a pension."

According to this law, a modern pension system is formed of two levels: accumulative and distributive. Appear new financial - economic institutions: pension funds, organizations involved in the investment management of pension funds, banks - custodians etc.

The Prime Minister of Kazakhstan KarimMassimov said "Accumulation Pension System in the Republic of Kazakhstan - is our achievement. A lot of things have been done. At the same time- he noted that- accumulative system needs rethinking and adequate answers to the problems, which is ripe today.”

Establishment, formation and management of accumulation pension fundsin transitional economy one of the most timely and insufficient learned problem.

Actuality of the course work is the need to improve management of pension assets, which will serve as a factor, not only growth in the volume of savings of the population, but will help stimulate economic growth.The theme is particularly relevant in the context of problems related to the existing shortage of effective financial instruments and restrictions in the structure of the investment portfolio of pension funds.

The aim of this work is the study and analysis of the development of a accumulative pension system in the Republic of Kazakhstan, based on an analysis of the performance of pension funds to identify problems of the pension market as a whole and suggest ways to solve these problems, the development of plans and recommendations aimed at further dynamic development of the system.

The following research objectives:

· review of theoretic-methodological aspects of a funded pension system;

· analysis of current status and development of accumulative pension system in Kazakhstan;

· identify ways to improve the pension system and improving its social importance.

The object of study is the accumulative pension system of the Republic of Kazakhstan.

The subject is the aggregation of socio-economic relations in the process of organization of pension funds of Kazakhstan.

The theoretical, methodological and information base of course work totaled works of our scientists in the field of pensions and pension funds management. Database research served as the statistics of the Ministry of labour and social protection of RK, the Ministry of finance, the Agency of RK on regulation and supervision of financial market and financial organizations of the National Bank of RK, Agency for statistics, financial statements of Kazakhstan APF. The legal basis used legislative acts and normative documents of the Government of RK, the official policy papers on development of pensions in the country.



1. Theoretical aspects of accumulation pension system

1.1 Economic essence of pensions

Pension funds of Kazakhstan at present is a system of three levels (pillars) that combine solidarity and accumulative mechanisms simultaneously.

Multilevel model of functioning of pension is calculated on the whole population of Kazakhstan. Population segmentation by categories, determining the source of pension payments (State budget and/or pension funds), was based on the age characteristics of citizens involved in the pension system.

The first level is the solidary pension system inherited by Kazakhstan from the Soviet Union after its collapse and based on "intergenerational solidarity", in which the pension becomes a source of State budget with tax deductions of working population and other revenues. Retirement benefits is determined by seniority. Within this level are formed by pension benefits for those whose pensionable service at the time of retirement as of January 1, 1998, is at least six months.

Expulsion mandatory pension contributions during the period of employment meets the conditions of the second tier of the pension system and already obliges the young generation be responsible for its level of income in retirement, as a source of pension payments will be generated by their individual retirement account savings.

Third level-funded system based on voluntary contributions and voluntary occupational pension contributions. Everyone is invited to the voluntary pension contributions increase their build-up and thereby secure higher income after completion of work.

Accumulative pension system is a critical component of social welfare of the Republic, on the one hand, and a vehicle for investing in the economy of Kazakhstan, on the other.

The essence of a funded pension system is to preserve and increase investors ' funds, i.e. investing in real creation. The mechanism of operation is as follows: employers monthly royalty in the form of mandatory pension contributions 10 percent of pay, including salary, all kinds of different prizes, surcharge, surcharges.

Pension contributions are directed to accumulation pension fund chosen by the depositor, to whom the pension contract offer individual retirement account and personal-social individual code. Accumulated contributions funds pass through the depositors authorized custodian bank company under the investment management of pension assets, which allocates funds in securities, deposits of banks and other financial instruments. You received when placing income investment income is distributed called on individual accounts of depositors in accordance with the amount of accumulated funds. Thus, the individual pension savings depositors paid them at retirement age.

Kazakhstan model of pension system is based on the following principles:

· providing investors and recipients the right to choose the Pension Fund;

· compulsory participation in system of all working population;

· differentiation...