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Sources and legal mechanisms of financing of social security during the Soviet and Post-Soviet periods: comparative and legal analysis



UDK 321 [091]; 34 [091]

SOURCES AND LEGAL MECHANISMS of FINANCING of SOCIAL SECURITY DURING the SOVIET AND POSTOVETSKY PERIODS the COMPARATIVE and LEGAL ANALYSIS

Belgorod

university

e-mail:lmvl8@mail.ru

M.V. LEVShUK

For increase in efficiency of activity of a system of the state provision of pensions in the Russian Federation, achievements of long-term financial stability of this system, search of the optimum directions of reforming of a legal mechanism of financing and additional sources of financial security of the social sphere of the Russian Federation, the author investigates positive long experience of the Soviet state social security system in historical and legal aspect.

In Article 7 of the Constitution of the Russian Federation it is written down that "The Russian Federation is the social state which policy is directed to creation of the conditions providing worthy life and free development of the person" 1. Realization of goals of the socially oriented state as fairly marks out S.V. Paramonov, is impossible without social and economic institutes, "purposefully to them created and supported" 2. Because social security is the main direction of social policy of the state, one of such institutes is the Russian institute of provision of pensions. Our country is only proclaimed the social state, and in reality Russia only follows a way of formation of the social state. The institute of provision of pensions existing in Russia, in particular, a legal mechanism of financing of provision of pensions in the Russian Federation, demands modernization. For increase in efficiency of activity of a system of the state provision of pensions in the Russian Federation, achievements of long-term financial stability of this system, search of the optimum directions of reforming of a legal mechanism of financing and additional sources of financial security of the social sphere of the Russian Federation, it is necessary to investigate positive long experience of the Soviet state social security system.

Now in the Russian Federation the provision of pensions is carried out by the Pension Fund of the Russian Federation according to the so-called "mixed" model of pension insurance combining the solidary and distributive and accumulative principles. In the systems of mandatory pension insurance of such combination in one country in the world is not present. Usually the investment part of the state pension in the mixed model is formed on a voluntary basis, and a basic unit - for the account byudzheta3. The first normative legal act which contains a mention of the Pension Fund of the Russian Federation and of its functions is the Law of the Russian Federation of November 20, 1990 No. 340-1 "About the state pensions in the Russian Federation" 4. The Pension Fund of the Russian Federation is formed by the resolution of the Supreme Council

1 The constitution of the Russian Federation (accepted by national vote of 12.12.1993-) -//SZ Russian Federation. 2009. No. 4. Article 445.
2 Paramonovo S.V. Provision of pensions - institute of social protection of the population in social market economy.//Messenger of KrasGAU. 2006. No. 10.
3 V.G. Pavlyuchenko. Social insurance. - M, 2007. Page 188.
4 Sheets of the UMP and VS RSFSR. 1990. No. 27. Article 351.

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RSFSR of December 22, 1990 No. 442-1 "About the organization of the Pension fund of RSFSR" 5 for public administration by finance of provision of pensions in RSFSR. With creation of the Pension fund in Russia essentially new funding mechanism and payments of pensions and grants appeared. Means for financing of payment of pensions began to be formed due to receipt of obligatory insurance premiums of employers and citizens. Thus, the means intended for provision of pensions, remaining at the same time state ownership, were allocated from structure of the government budget in the independent budget of the Pension fund of RSFSR. With establishment of autonomy of the pension budget the revenues of Fund ceased to enter budgets of other levels, the step to the insurance principles for the purpose of increase in efficiency of activity of a system of the state provision of pensions in the Russian Federation was taken. Since 1997, the moment of entry into force the Federal law of April 01, 1996 No. 27-FZ "About the individual (personified) account in the system of the national pension insurance" 6, major importance for establishment of the amount of pension has not the general seniority, and the considered insurance experience and the amount of payments which were made for the benefit of the worker by his employer. The financial foundations of mandatory pension insurance in the Russian Federation are laid by the Federal law of December 15, 2001 No. 167-FZ "About Mandatory Pension Insurance in the Russian Federation" 7 according to which, the Pension Fund of the Russian Federation is the insurer on mandatory pension insurance, and the state takes only subsidiary responsibility according to obligations of the Pension Fund of the Russian Federation to the insured persons in case of insufficiency of profitable sources at the Pension Fund of the Russian Federation.

We suggest to investigate the period of formation and development of the Soviet system of public authorities of social security in legal aspect. According to E.N. Dobrokhotova, M.V. Filippova, M.A. Yanturayeva, for the first time the official term "social security" is used in the Provision on social security of workers of October 31, 1918 goda8. The specified normative legal act entered general social security of all workers who are not exploiting the stranger of work and not having sources of means to sushchestvovaniyu9. Thus, for the first time in the Soviet state there was a legislative fixing of providing the population at the expense of the state and through public authorities. Advantage of such state social security system was that in case of loss of sources of means of livelihood one and all citizens whose livelihood was their own work were subject to providing.

In December, 1918 the first Labour Code of RSFSR (Labour Code) drafted by Narkomat of work and the All-Union Central Council of Trade Unions and generalizing all previous Soviet legislation on work was adopted. Effect of the Code extended to all persons who are employed in all sectors of economy (state, cooperative, private). The Labour Code replaced the system of social insurance (payments from funds of the enterprises and institutions) with a social security system (payments from the centralized funds of the state) that was connected with structural changes in economy - continuous nationalization of production and centralization of management and finansirovaniya10.

The decree of SNK of April 17, 1919 goda11 to the Provision on social security of workers of October 31, 1918 made changes in the part concerning it a financial system. All insurance funds were contributed to the All-Russian fund of social security, and the organizations owning these funds were subject likvida-

5 Sheets of the UMP and VS RSFSR. 1990. No. 30. Article 415.
6 SZ Russian Federation. 1996. No. 14. Article 1401.
7 SZ Russian Federation. 2001. No. 51. Article 4832.

E.N. Dobrokhotova, M.V. Filippova, M.A. Yanturayeva. Soviet right of social security. - SPb., 1992. - Page 4. See: SU RSFSR. 1918. No. 89. Article 906.

9 SU RSFSR. 1918. No. 89. Article 906.
10 I.A. Isaev. History of state and law of Russia. Textbook. - M, 2005. - Page 575-576.
11 M.L. Zakharov, Loaves V.V., A.N. Kolesnikov, Ja.M. Vogel. Lenin decrees about social security. - M, 1972. - Page 38.

tion. Since May, 1919 the delivery of grants to patients, pregnant women and women in labor was assigned directly to the enterprises and institutions which to these persons kept the salary within 2 months. Gradually the wave of non-payments at full absence of control of expenditure of means led to fiasco of all system of collecting insurance premiums. Funds for payments it was spent not so much how many it was collected, and how many it was required. The deficit was covered at the expense of the printing monetary machine that strengthened inflation even more. In this regard the principles of social insurance were replaced with order of direct budget financing of social security. There was a change of a political and economic course in the sphere of social security: from the insurance principles of social security of workers proclaimed in the first decrees of the Soviet power to the state social security. The state became an exclusive subject of management of a social security system.

After formation of the USSR in 1922 social security remained under the authority of federal republics, and all-federal governing body was not created. Social security at first narcomats of the republics, and since 1923 - Narkomat of work of the USSR knew. In 1926-1927 in some Transcaucasian republics the narcomats of social security were merged with republican commissariats of internal affairs and commissariats of work. Similar process happened also in a number of autonomous republics

According to the resolution of the Central Election Commission of the USSR, SNK and All-Union Central Council of Trade Unions of June 23, 1933 goda13 the control of business of social insurance was transferred to labor unions. According to the resolution SNK USSR and All-Union Central Council of Trade Unions of September 10, 1933 goda14, all means of social insurance were transferred to labor unions since September 15, 1933, and the general leadership in business of social insurance, control and instructing of labor unions concerning social insurance, submission to the Government of the USSR of the draft of the allied budget of social insurance and tariffs of insurance premiums was assigned to the All-Union Central Council of Trade Unions.

The resolution of the All-Russian Central Executive Committee and Council of People's Commissars of RSFSR of October 7, 1937 No. 99715 approved the Provision on the National commissariat of social security of RSFSR with which enforcement the Provision on the National commissariat of social security of RSFSR16 approved on November 30, 1931 was repealed. The national commissariat of social security of RSFSR carried out material security of the citizens who incapacitated, providing on an old age and organized inservice training and the labor device of the citizens who partially lost working capacity. The main objectives of the National commissariat of social security of RSFSR were: drawing up development plans for matter of social security in RSFSR and also summary target figures and funding plans of the organizations, institutions and the enterprises subordinated to the National commissariat of social security; control over the implementation of these plans; control over the implementation of plans of the public organizations which were under its management; introduction on the statement of legislature of drafts of laws on social security; the publication of orders and instructions on issues of social security and the adoption of provisions and charters of the organizations, institutions and enterprises entering its system or being under its management; control of performance of the existing Social Security Acts. The structure of the National commissariat of social security of RSFSR included the head planovofinansovy department in structure: department of summary planning, sector of sectoral planning, sector of statistics, main accounts department of the National commissariat. Later the National commissariat of social security of RSFSR was transformed to Mini-

12 Andreyev of B.C. The right of social security in the USSR. - M, 1980. - Page 30'E1-
13 SZ USSR. 1933. No. 40. Article 238.
14 SZ USSR. 1933. No. 57. Sg. 333.
15 Resolution of VTsIK, SNK RSFSR of October 7, 1937 No. 997 "About the adoption of the Provision on the National commissariat of social security of RSFSR".//System Consultant Plus: Documents of the USSR.
16 SOBR. It is narrow. 1931. No. 37. Article 512; 1933. No. 47. Article 200; 1936. No. 2. Article 7.

RSFSR12.

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sterstvo of social security of RSFSR. According to the Provision on the Ministry of Social Welfare of RSFSR approved by the resolution of Council of ministers of RSFSR of September 20, 1968 17 one of the main tasks of the Ministry in the field of provision of pensions the every possible development of business of social security for the fullest satisfaction of social needs of aged and disabled citizens and also the leadership in interdepartmental financial control in bodies of social security was. The ministry developed instructions and methodical instructions for conducting such control and about an order of carrying out documentary audits, checked correctness of purpose of pensions and grants, a condition of controlnorevizionny work in local bodies, carried out documentary audits of finansovokhozyaystvenny activity of the institutions and the organizations subordinated to it and also, in case of need, local bodies and institutions of social security.

According to Article 5 of the Law of the USSR "About the State Pensions" of July 14, 1956 goda18, and also according to the Provision on an order of appointment and payment of the state pensions approved by the resolution of Council of ministers of the USSR of August 4, 1956 No. 104419, pensions were appointed by the commissions on purpose of pensions formed by executive committees of regional (city) Councils of deputies of workers. The resolution of Council of ministers of the USSR of August 3, 1972 approved the Provision on an order of appointment and payment state pensiy20 according to which, provision of pensions was carried out by bodies of social security, public control over the correct expenditure of the means provided for provision of pensions and for service of pensioners was carried out by labor unions. Departments of social security paradise (mountains) of executive committees which organized appointment and payment of various pensions and grants and also social service of disabled people, aged and the families which lost the supporter were among public authorities of social security. Separate functions on social security of some categories of workers were performed by other public authorities, for example, military registration and enlistment offices concerning provision of pensions of the personnel military personnel. Public bodies of social security were trade-union committees which granted allowances on social insurance, provided permits to sanatorium treatment, dietary food, prepared documents, necessary for award of pension, together with administration, carried out other work on social strakhovaniyu21. Local authorities exercised the general control of respecting the rule of law in activity of bodies of a system social obespecheniya22. Regional and city departments of social security were formed respectively by regional and city councils of People's Deputies and submitted in the activity both to executive committee of the relevant Council of People's Deputies, and higher bodies social obespecheniya23. Thus, the bulk of means was spent for payment of different types of pensions

17 Provision on the Ministry of Social Welfare of RSFSR. Approved by the resolution of Council of ministers of RSFSR of September 20, 1968 No. 654.//JV RSFSR. 1968. No. 19. Article 99.
18 Law of the USSR "About the State Pensions" of July 14, 1956.//Code of laws of the USSR. of t. 2. 1990. Page 532.
19 Resolution of Council of ministers of the USSR of August 4, 1956 No. 1044 "About the adoption of the Provision on an order of appointment and payment of the state pensions".//USSR Union of Writers. 1957 No. 1. Article 1.
20 V.A. Babkin, G.B. Smirnova. Comment on the provision on an order of appointment and payment of the state pensions. - M, 1983-
21 In the same place. - Page 74-78.
22 Paragraph 5, the 6th Article 19 of the Law of the USSR "About the Main Powers of Regional, Regional Councils of People's Deputies, Councils of People's Deputies of Autonomous Regions and Autonomous Areas".//Sheets of the Supreme Council USSR. 1980. No. 27. Article 526; Paragraph 33 of Article 8 of the Decree of Presidium of the Supreme Council of the USSR "About basic rights and obligations of regional council of People's Deputies" of March 19, 1971 with changes and additions of November 28, 1978//In the same place. 1978. No. 795; Sg. 7 Decrees of Presidium of the Supreme Council of the USSR "About basic rights and obligations of city and regional Councils of People's Deputies in the cities" of May 19, 1971 with changes and additions of November 28, 1978//In the same place. Article 796.
23 Provision on department of social security of executive committee of regional, regional council of People's Deputies. Approved by the resolution of Council of ministers of RSFSR of August 6, 1982 No. 447.//JV RSFSR. 1982. No. 18. Article 126.

and grants directly local bodies of social security - regional and city departments, the centers for charge and payment of pensions and grants in those areas, edges and the ASSR where payment and accounting of pensions were centralized.

The resolution of Presidium of the All-Union Central Council of Trade Unions of February 29, 1960 goda24 in coordination with the Ministry of Finance of the USSR and the State committee of Council of ministers of the USSR concerning work and the salary approved the Instruction about an order of collection of insurance premiums and expenditures of means of the national social insurance according to which, insurance premiums were assessed on the salary of all workers and employees, including regular, supernumerary, seasonal, temporary, working part-time or performing single, odd and short-term jobs and also on the salary of workers of other categories (except workers and employees), to whom social insurance was extended by special decisions. Insurance premiums were assessed for all sum of the salary without any deduction (for example, on income tax) and irrespective of payment sources (at the expense of the wages fund, allocations of a special purpose, means of the customer and other means).

On October 17, 1964 the resolution of Council of ministers of the USSR approved the Provision on an order of appointment and payment of pensions to members kolkhozov25. According to standards of the specified Provision, payment of pensions was provided at the expense of means of the centralized allied fund of social security of collective farmers without any deductions from the income of members of collective farms, provision of pensions was carried out by councils of social security of collective farmers and public authorities social obespecheniya26. According to the Provision on the centralized allied fund of social security of collective farmers approved by the resolution of Council of ministers of the USSR of January 27, 1978 No. 6827, the specified fund was formed due to assignments of collective farms, the intercollective-farm enterprises and the organizations and also annual allocations of the Government budget of the USSR. As the called resolution were recognized become invalid for the resolution of Council of ministers of the USSR of November 6, 1964 No. 919 "About the adoption of the Provision on the centralized allied fund of social security of collective farmers" 28 and of September 30, 1966 No. 791 "About modification of Paragraph 7 of the Provision on the centralized allied fund of social security of collective farmers" 29. The order and the amount of assignments of collective farms and intercollective-farm enterprises and organizations in the centralized allied fund of social security of collective farmers were established by Council of ministers of the USSR. Boards of collective farms and councils of the intercollective-farm enterprises and the organizations provided till February 15 in regional council of social security of collective farmers and in regional (city) finance department calculations of contributions to the centralized allied fund of social security of collective farmers. The regional council of social security of collective farmers considered the specified calculations and also the conclusions for them regional (city) finance department, determined the sum of contributions to the centralized allied fund of social security of collective farmers with participation of the representative of the relevant collective farm, intercollective-farm enterprise, organization and reported this sum till March 1 to each collective farm, the intercollective-farm enterprise, the organization and regional (city) finance department. Collective farms and the intercollective-farm enterprises and the organizations brought contributions to the centralized allied fund of social security of collective farmers into special accounts in institutions of the State Bank of the USSR in the following terms: by March 5 - 15%, by May 15 - 25%, by August 15 (hlopkoseyushchy collective farms - by October 1) - 30% and by November 15 - 30% of the annual sum of assignments. At approach of terms of payments and lack of means on the current accounts of collective farms and settlement accounts

24 Collection of official documents. Social security and insurance in the USSR. - M, 1979. - Page 420.
25 V.N. Mikhalkevich, G.S. Shederova, Ja.M. Vogel. Comment on the Provision on an order of appointment and payment of pensions to members of collective farms. - M, 1980.
26 In the same place. - Page 22-26.
27 USSR Union of Writers. 1978. No. 4. Article 24.
28 USSR Union of Writers. 1964. No. 22. Article 137.
29 USSR Union of Writers. 1966. No. 21. Article 190.

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the intercollective-farm enterprises and the organizations in institutions of the State Bank of the USSR the instructions for transfer of means in the centralized allied fund of social security of collective farmers were accepted to execution by institutions of the State Bank of the USSR and were carried out in the sequence established for payments on the national social insurance. The contributions to the centralized allied fund of social security of collective farmers which are in due time not transferred by collective farms and the intercollective-farm enterprises and the organizations into special accounts in institutions of the State Bank of the USSR were collected according to the order of regional (city) finance department in an indisputable order, in the sequence established for collecting contributions on state social insurance without charge of a penalty fee. Established by the provision on the centralized allied fund of social security of collective farmers an order of expenditure of means of this fund which consisted in the following. The Ministry of Finance of the USSR reported to the Ministries of Finance of federal republics and the State Bank of the USSR the size of expenses of federal republics on payment of pensions and grants in the following behind flowing to year at the expense of means of the centralized allied fund of social security. Control of expenditure of these means within the size of expenses reported by the Ministry of Finance of the USSR it was carried out by financial bodies. Delivery of funds for payment of pensions and grants at the expense of the centralized allied fund of social security of collective farmers it was made by institutions of the State Bank of the USSR on orders of bodies of social security from the separate account on payment of pensions and grants within the sums of the expenses on quarter specified in references of the bodies of social security and confirmed with financial bodies. The order of execution of certificates of the sums of expenses of means of the centralized allied fund of social security of collective farmers was established by the Ministry of the USSR and the State Bank of the USSR. Summary data on receipts in the centralized allied fund of social security of collective farmers and expenses on payment of pensions and grants at the expense of this fund were formed institutions of the State Bank of the USSR on the basis of monthly summary reporting balances and were reported by them to regional, regional finance departments, the Ministries of Finance of autonomous and federal republics and also the Ministry of Finance of the USSR. Control of correctness of assignment of means in the centralized allied fund of social security of collective farmers and also behind expenditure of these means was carried out by regional, regional and republican councils of social security of KOLHOZNIKOV30.

"Provision of pensions of workers as M.L. Zakharov and E.G. Tuchkova fairly note is formal during the Soviet period, it was carried out as the national social insurance (that, in particular was fixed in the Labour Code of RSFSR), however nobody brought target insurance payments - neither employers, nor insured" 31.

According to article loo of Principles of the legislation of USSR and federal republics about trude32, all workers and employees were subject to obligatory national social insurance. The national social insurance of workers and employees was carried out at the expense of the state. Contributions to social insurance were paid by the enterprises, institutions, the organizations without some deductions from the salary of workers and employees. Failure to pay by the enterprise, institution, organization of insurance premiums did not deprive of workers and employees of the right for providing on the national social insurance. Article loi of Principles of the legislation of USSR and federal republics about trude33 established the following types of providing on social insurance: i) temporary disability benefit, a grant on pregnancy, childbirth and on child care before achievement of age by it one year; 2) a grant on the occasion of the child's birth; grants to burial; h) an old-age pension, on disability, on the occasion of loss of the supporter and also the long-service pensions established for some categories of workers. Means of the national social insurance ispol-

30 Resolution of Council of ministers of the USSR of November 6, 1964 No. 921 "About the adoption of the Provision on councils of social security of collective farmers".//USSR Union of Writers. 1964. No. 22. Article 139.
31 M.L. Zakharov, E.G. Tuchkova. Right of social security of Russia. - M, 2004. - Page 46.
32 Sheets of the Supreme Council USSR. 1970. No. 29. Article 265.
33 In the same place.

be filled up also on sanatorium treatment of workers and employees, service with their dispensaries and holiday houses, on clinical (dietary) nutrition, on the maintenance of summer camps and other actions on state social strakhovaniyu34. Establishment of the rules determining an order and the amount of providing by the national social insurance according to Article 107 of Principles of the legislation of USSR and federal republics about trude35, treated maintaining USSR.

Expenses on payment of pensions and grants by regional (city) departments and centers for charge and payment of pensions and grants occupied over 97% in a total amount of expenses on actions for social security. Sources of their financing was the Government budget of the USSR and the centralized allied fund of social security of collective farmers. From the allied budget child allowances were paid to needy families of the unemployed pensioners receiving the state pensions; from the republican budget of the federal republic - pension on the national social insurance, grants to pensioners on the birth of the child and on burial, a postage on delivery of pensions and grants, and since January 1, 1970 - pension to workers of science, monthly allowances to disabled people since childhood, other grants and cultural and community service of pensioners, pensions and grants to the military personnel of ordinary, non-commissioned officer's and starshinsky structure of conscription service and their families, including pensions to disabled people of civil and first world wars and to their families, grants to the above-stated pensioners on the birth of the child and on burial, a postage on delivery of pensions and grants; maternity allowances and on the child's birth to women - the military personnel fired from Armed Forces of the USSR in connection with pregnancy, and on children to wives of soldiers, sailors, sergeants and foremen of conscription service and also child allowance to wives of the soldiers, sailors, sergeants, foremen and reserve officers called on training sessions and by the time of an appeal on them temporarily not working; welfare payments to having many children and lonely mothers. Till January 1, 1970 the payment of pensions and grants was carried out at the expense of the credits allotted by higher body of social security - the manager of the credits, through the State Bank of the USSR. After the specified date the expenses on payment of pensions and grants were made by a uniform order without opening of the credits, according to applications of bodies of social security. At the expense of means of the republican budget of the autonomous republic, the regional (regional) budget, pensions and grants were paid to merit pensioners of local value, lump sums to disabled people of the Great Patriotic War, their families, families of the soldiers who died in war there was a sanatorium help to disabled people. From the regional (city) budget pensions and grants were paid to merit pensioners of local value, other monthly allowances. At the expense of means of the centralized allied fund of social security of collective farmers, pensions to members of collective farms (on an old age, disability, on the occasion of loss of the supporter), grants were paid to women - to members of collective farms on pregnancy and childbirth, a postage was paid for delivery of pensions and grants and also child allowances to needy families of members of collective farms, pensioners. Managers of the funds allocated for payment of pensions and grants in regional and city departments of social security were managers of these departments, and in the centers for charge and payment of pensions and grants - chiefs of the centers who were responsible for the correct expenditure and safety of means. Along with them responsibility for observance of all existing laws and provisions on payment of pensions and grants, the budgetary discipline, for the organization of accounting and the reporting was born by the chief (seniors) accountants of bodies of social security. All operations on the movement of the funds allocated for this purpose from the government budget and the centralized allied fund of social security of collective farmers and their expenditure in a section of separate types and sources of means and also the calculations arising in the course of payment of pensions and posobiy36 affected balance of bodies of social security on payment of pensions and grants.

34 Decree of Presidium of the Supreme Council of the USSR of September 2, 1981.//Sheets of the Supreme Council USSR. 1981. No. 36. Article 1032.
35 Sheets of the Supreme Council USSR. 1970. No. 29. Article 265.
36 G.V. Petrov-Denisov, N.P. Izmaylov. Accounting in bodies of social security. - M, 1977. - Page 9-11.

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According to Paragraph 124 of the Provision on an order of the appointment and payment of the state pensions approved by the resolution of Council of ministers of the USSR of August 3, 1972 No. 59037 the earnings for calculation of pension joined all types of the salary on which by the existing rules insurance premiums, except the salary for overtime work, for combining jobs and any payments of single character were assessed. The percentage markups and an annual reward paid for long service, a reward from fund of material encouragement for the general results of work of the enterprise or organization following the results of in a year joined in earnings from which pensions were estimated. When at separate categories of workers it was impossible to exclude earnings for overtime work from earnings or for the work performed by other persons because working hours of these workers did not give in to account (home-workers, regular suppliers of agricultural products, food waste, secondary and other types of raw materials, sellers of peddling and delivery trade, agents of the photoenterprises, freelance representatives for distribution of theatrical tickets and also other similar categories of workers determined in necessary cases by the State committee of Council of ministers of the USSR concerning work and the salary together with the All-Union Central Council of Trade Unions), pensions were estimated from the actual earnings, but no more than from one and a half tariff (settlement) rates or one and a half monthly salaries, with application in appropriate cases of coefficients and with charge of bonuses for work in the region of the Far North and in the areas equated to the region of the Far North. At the same time, if the tariff (settlement) rate or a salary for the corresponding category of workers were not established, then one and a half rates or one and a half salaries of workers of similar professions or holding similar positions were considered. In cases when insurance premiums were assessed for the conditional sums of earnings, average earnings for calculation of pension joined these conditional sums.

The instructive letter of the Ministry of Social Welfare of RSFSR of December 16, 1974 No. 1-137-I38 approved the All-Union Central Council of Trade Unions approved by Presidium on November 22, 1974 the List of types of rewards, awards and other payments on which insurance premiums are not assessed. It should be noted that this list was rather detailed, but not exhaustive. Separate payments in it were given as an example to any given type of payments. If any given payment, a reward or an award was not specified in the list and was not similar on the nature of subjects which were listed in it, then on such payment, a reward or an award insurance premiums had to be assessed.

Thus, the Soviet state social security system entered the so-called system of social insurance, however, did not contain economic signs of a system of the national pension insurance most of which visually are expressed in the basic principles of the national pension insurance. However, despite numerous economic shortcomings, this system had one important advantage - it provided to all categories of citizens minimum necessary living level. Therefore the Soviet pension system carried definition - the state social security. Funds for the state provision of pensions, as well as other funds for the national social insurance, accumulated in the budget of the national social insurance which in turn, was included into the government budget of the country. The pension system was based on the consolidated program of financing of payment of pensions and completely depended on balance of the government budget of the country. The budget of provision of pensions was a component of the government budget of the USSR and was included in it both on income, and on expenses. In such look the legal mechanism and sources of financing of the Soviet state social security system existed, practically without changes, till 1990. Distinctive feature of a legal mechanism of financing of the Soviet state system sotsi-

37 USSR Union of Writers. 1972. No. 17. Article 86.
38 Collection of orders and instructive letters of the Ministry of Social Welfare of RSFSR. Part VI. - M, 1986. - Page 90.

alny providing throughout all this period its state character shown in the centralized management, the public balanced financing, state planning and the state control of expenditure of the funds allocated by the state for social security was. We believe that this favorable difference allowed the Soviet system of public authorities of social security to reach long-term financial stability. Therefore, it is possible to draw a basic conclusion that the legal mechanism of public financing of a social security system of the Soviet period is much more effective than a legal mechanism of financing of a social security system with subsidiary responsibility of the state during the Post-Soviet period.

1. The constitution of the Russian Federation (accepted by national vote of 12.12.1993-)//SZ Russian Federation. 2009. No. 4. Article 445.
2. Paramonovo S.V. Provision of pensions - institute of social protection of the population in social market economy.//Messenger of KrasGAU. 2006. No. 10.
3. V.G. Pavlyuchenko. Social insurance. - M, 2007. Page 188.
4. Law of the Russian Federation of November 20, 1990 No. 340-1 "About the state pensions in the Russian Federation".//Sheets of the UMP and VS RSFSR. 1990. No. 27. Article 351.
5. Resolution of the Supreme Council of RSFSR of December 22, 1990 No. 442-1 "About the organization of the Pension fund of RSFSR".//Sheets of the UMP and VS RSFSR. 1990. No. 30. Article 415.
6. The federal law of April 01, 1996 No. 27-FZ "About the individual (personified) account in the system of the national pension insurance".//SZ Russian Federation. 1996. No. 14. Article 1401.

7. The federal law of December 15, 2001 No. 167-FZ "About mandatory pension insurance in Rossiys

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