The Real Russia. Today. Underfunded pensions, overtime teachers, Navalny's crowdfunding, and Yekaterinburg's mini-skirts

Wednesday, April 25, 2018

• The Russian pension system's 2018 deficit will be twice as big as predicted
• Two U.S. senators want the banking world to come clean about cracking down on Russian “oligarchs”
• Teachers are earning more, like Putin promised, but...
• Syria says it's already got Russian S-300s
• Moscow will restrict booze sales and consumption during the FIFA World Cup
• Alexey Navalny's brother will stay in prison for a bit longer
• Navalny's presidential campaign says it raised $6 million
• Mini-skirts in the Yekaterinburg snow cause a scandal
• Investigators dismiss torture allegations raised against the FSB by another terrorism suspect
• Take Meduza's new quiz on Kremlin talking points

Russia's pension system is increasingly underfunded 🧓

Russia’s Labor Ministry has amended the Pension Fund’s 2018 budget to reflect a deficit that's more than twice as high as predicted, rising from 106.6 billion rubles ($1.7 billion) to 256.8 billion rubles ($4.1 billion). The Pension Fund is expected to earn just 66.7 billion rubles ($1.1 billion), while spending 83.5 billion rubles ($1.3 billion). Spokespeople for the Pension Fund told the magazine RBC that the revised forecast is the result of cuts in federal subsidies and the rising costs of Russia’s pay-as-you-go pension payments.

The Pension Fund's “distributive” budget (the money collected from working Russians and paid to current retirees) will be more than 150 billion rubles underfunded in 2018, and the Labor Ministry plans to plug the gap with money taken from the fund's “transferrable” budget.

Policymakers in Moscow who advocate raising the retirement age in Russia cite the Pension Fund’s rising deficits as one of the key justifications. The news media has repeatedly published stories that the government is considering this unpopular move, but the Kremlin has always said it has no immediate plans to institute such reforms.

How does Russia’s pension system work? In 2014, Russia suspended its experiment with a market-based savings program that allowed younger workers to invest up to six percent of their income back into the economy. Under this system, another 16 percent of these people’s salaries went to the pension system’s “insurance component,” funding both “fixed basic payments” (the pension benefits guaranteed to all pensioners) and individual accounts (allowing higher earners to receive slightly larger pensions). The moratorium on market accounts is supposed to expire in 2020.

A friendly inquiry from two curious senators 🇺🇸

Two Democratic senators, Jeanne Shaheen and Sheldon Whitehouse, have written to several major banks in the U.S. and Europe, asking whether they’ve reviewed their records in the past five years to determine if any of their accounts are controlled by the Russian “oligarchs” or senior political figures recently sanctioned by Washington. Shaheen and Whitehouse also want to know what the banks have done to identify any links to the listed Russians. “If the banks do not provide the information, the senators plan to seek potentially more intrusive action, such as a government investigation,” reported Reuters.

Teachers raise income by working more. Thanks, Putin. 👩‍🏫

As Vladimir Putin’s May 2012 executive orders promised, Russian school teachers are now earning more. According to a new study, however, they’re also working a lot more. The Russian Presidential Academy of National Economy and Public Administration found that the percentage of teachers working double shifts to raise their income grew from 7.3 percent in 2014 to 13.8 percent in 2017.

In May 2012, Putin ordered the government to raise teachers’ salaries to the average income level in their region. In 2017, Russian teachers earned on average almost 420,000 rubles ($6,750) a year — 19,200 ($310) more than a year before. Critics argue that income is rising because more teachers are working multiple shifts.

Pipe down, Syria 🇸🇾🇷🇺

Riyad Haddad, Syria’s ambassador to Russia, says Moscow started supplying Damascus with S-300 long-range surface-to-air missile systems at least a month ago, though Russian Foreign Minister Sergey Lavrov said as recently as April 23 that the Kremlin still hasn’t reached a decision about the weapon. Speaking to Interfax, an unnamed “military-diplomatic source” also refuted Haddad’s claim.

Why are we talking about the S-300 again? In 2010, Russia tentatively agreed to supply Syria with the S-300, but the deal collapsed under Israeli pressure. On April 14, 2018, following a recent allied airstrike on Syria, the Russian Defense Ministry said it might revive the idea of sending S-300 systems to Damascus. Israel has promised to destroy any defense systems that fire on its aircraft. After the April 14 attacks, Russian officials claimed that Syrian air defense intercepted most of the U.S. cruise missiles fired at Syrian targets. Washington denies this. There are no reports that Syria used S-300 systems in its response to the allied airstrikes.

Drink responsibly, soccer fans 🍻⚽️

If you’re headed to Moscow this summer for the FIFA World Cup, expect expect a lot of blocked-off streets and sweeping restrictions on the sale of alcohol (as well as any drinks packaged in glass bottles). A city official told the news agency Interfax on Wednesday that a ban on the sale and consumption of alcohol will take effect in certain areas of Moscow on the days leading up to tournament games. The city is also mobilizing a large force of police and medical staff to manage intoxicated fans.

The 2018 FIFA World Cup, which begins on June 15 and wraps up on July 15, will take place in Moscow, St. Petersburg, Nizhny Novgorod, Kaliningrad, Kazan, Samara, Saransk, Volgograd, Rostov-on-Don, Sochi, and Yekaterinburg.

The life and times of Navalny ✊

⚖️ Unwelcome supreme news

The Presidium of the Russian Supreme Court has refused to overturn the December 2014 verdict in the so-called “Yves Rocher” case that sent Oleg Navalny to prison for three and a half years for supposedly embezzling several million rubles from an Eastern European subsidiary of the cosmetics company Yves Rocher. Oleg’s better known brother, the activist Alexey, demanded his immediate release in accordance with the European Court of Human Rights’ October 2017 ruling that the Navalnys’ right to a free trial had been violated. (The ECHR refused, however, to say that the Yves Rocher case was politically motivated.)

The Russian Supreme Court also concluded that the Yves Rocher case should be reopened to consider the “new facts.” Navalny’s lawyer didn’t want the investigation reopened, pointing out that the last ECHR ruling to force a retrial of a case against Alexey Navalny (the “Kirovles” case) resulted in a verdict that was identical to the first.

So Oleg Navalny is left to rot behind bars? Even without the support of the Supreme Court, Oleg Navalny is due to go free from prison in about two months.

💰 The six-million-dollar man

Between December 2016 and April 2018, Alexey Navalny raised almost 373 million rubles ($6 million) for his presidential campaign, according to his manager, Leonid Volkov. The campaign collected money by various means, including Bitcoins (which accounted for nearly a quarter of all donations). Volkov says Navalny received money from more than 100,000 people.

Navalny’s presidential run ended when Russia’s Central Election Commission refused to register his candidacy because of his (contentious) felony record. The campaign managed to spend 368 million rubles, with 150,000 rubles in salaries and roughly 90 million rubles in campaign materials and demonstration costs. Volkov says about half the unspent remaining 5 million rubles ($80,200) is tied up in the frozen accounts of the liquidated “Fifth Season” nonprofit — a legal entity Navalny’s team repurposed to serve as the organizational basis of the presidential campaign. The rest of the money is apparently meant for tax payments.

“The children insisted” 🥁

A song and march competition run by the “Sons and Daughters of the Fatherland” project in Yekaterinburg is raising some eyebrows this week, after photos appeared online showing a group of women cadets dressed in short-skirt summer uniforms drilling in the snow. A representative from the project told the website Znak.com that the competition’s organizers weren’t prepared for unexpected snowfall on April 24. The cadets were apparently told they “could refuse” to participate in the contest, but all teams supposedly “consciously decided” to brave the weather and compete. “We offered to cancel the contest, but the children themselves insisted,” the project’s spokesperson said.

No torture investigation for the terrorism suspects 👮‍♂️

Russia’s Investigative Committee has refused to open a criminal case in response to reports that Federal Security Service agents tortured a second suspect in the “Penza case,” in which several leftist activists are charged with forming a terrorist organization and plotting attacks during the March 2018 presidential election and 2018 FIFA World Cup. Earlier this month, investigators rejected allegations that the FSB tortured another suspect in the same case.

On April 20, the television network NTV aired a report about the “Penza case” suspects, accusing them of plotting a “Maidan-style” revolution in Russia. The report also went after the human rights workers and lawyers who say the FSB tortured the suspects, accusing these people of working for hostile foreign powers.

Earlier in April, two human rights workers and a lawyer for one of the suspects were hounded by reporters who wouldn’t identify themselves. The journalists carried NTV microphones and bombarded them with questions about consorting with ”Ukrainian consuls” and “working with terrorists.” The women, at least one of whom appears to be a freelance stringer, knew where to find these people, leading to suspicions that the FSB tipped them off, perhaps to facilitate a smear campaign in the media.

• Read Meduza’s story about these mysterious reporters: “Attack of the TV stringers”

Take Meduza's latest quiz 👇

As press secretary for the Russian president, Dmitry Peskov has a challenging job where he’s regularly harassed by vicious reporters and forced to draw clumsy comparisons. Sometimes, the comparisons are perfectly suitable, but not always. Do you think you’re sharp enough to know when it’s okay to compare? Test your wits.

• Take Meduza’s quiz: “Armenian and Ukrainian unrest? Brexit and the USSR's collapse? What's an appropriate comparison? See the world through the Kremlin's eyes.”