How purchasing power of Ukraine's retiree changed in 2019?

Author : Olexiy Doroshenko

Source : 112 Ukraine

The buying capacity of Ukrainian pensioners has slightly increased, however, they barely feel this change
12:12, 15 August 2019

112 Agency

According to experts from the Association of Distribution Network Suppliers, retirees, who receive an age pension, can buy more bread this year.

We took the average rate of old-age pension as of January 1, 2019 - 2648 UAH (104 USD), and also as of July 1, 2019 - 3009 UAH (118 USD), as well as prices at the beginning of January and July 2019, according to our own monitoring. Association carries out its research on the prices of socially significant products in large cities.

Related: New attempt of government to move away from distribution mechanism to cumulative pension system

Although life on an average old-age pension is challenging, by the end of 2019, the purchasing power of pensioners has increased. This is primarily due to the increase in the average pension for the first quarter of 2019 by 13.6%.

At the same time, the cost of a bread basket increased by 6% over half a year:

  1. A pensioner in January of this year could buy 148 kg of bread made of wheat flour of the first category on his or her average old-age pension, and in July this number increased to 158 kg. That is, the material situation converted to bread improved by 7%, which equals 10 kg of bread additionally.
  2. At the beginning of the year, an average old-age pensioner could buy 134 kg rye bread at the beginning of the year, and after some six months - 145 kg. The increase was 8% or 11 kg.
  3. In January 2019, the pension could cover 105 kg of bread made of wheat flour of the first category, while in July this number increased to 113 kg. And this is 8%, or 8 kg more.

But when you meet Ukrainian pensioners and hear stories about life, it becomes clear that people have not felt this.

Related: How fast is Ukraine's pensions growth?

This could be revealed by in-depth opinion polls or focus groups. In our opinion, a large debt is ignored, and therefore part of the money always goes to pay it off.

The same situation is with medical expenses. Although the share of expenses for it has officially increased to 9%, it probably does not take into consideration the treatment of serious diseases, which the majority of the population suffers from due to difficult living conditions.

Related: Pensions growth in Ukraine: Key trend of recent years

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