The state guarantee for the safety of mandatory pension savings in Kazakhstan will not be canceled after 2027. Only the mechanism for one of the compensatory payments will change, reports infohub.kz.
The Ministry of Labor and Social Protection of the Population of Kazakhstan emphasized that the state guarantee itself remains in full and is enshrined in the Social Code. The change concerns the compensation procedure introduced during the early development of the funded pension system, when pension assets were managed exclusively by the state, providing a mechanism to offset the difference between investment returns and inflation.
The labor ministry explained that the changes are due to the evolution of the pension system and the expansion of citizens' ability to manage their own savings. Today, contributors can transfer up to 100% of their pension savings to private asset management companies, up from the previous maximum of 50%. As the ministry notes, the ability to choose a management company, investment strategy, and risk level means that contributors make investment decisions independently. Accordingly, the compensatory payment mechanism is being aligned with the new pension asset management model.
Meanwhile, the state retains existing pension savings protection mechanisms. The National Bank will continue to manage pension assets, focusing on their security and achieving returns above inflation in the long term. For private management companies, legislation requires financial stability, sufficient equity capital, and professional qualifications. Moreover, if a manager fails to achieve a set minimum return, it must compensate the difference from its own funds.
The ministry stressed that the changes aim to improve the funded pension system, increase the responsibility of management companies, and expand citizens' opportunities, without affecting the state guarantee for mandatory pension savings.