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Moscow Moves to Automatically Convert Millions of Pension Accounts Into a New State Investment Fund
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The Russian government is drafting legislation to automatically transfer the pension savings of tens of millions of citizens into a new state-run program.
This move targets approximately 37 million individuals categorized as "silent" investors—those who have not actively chosen a private pension fund and whose assets remain with the Social Fund of Russia, according to The Moscow Times on June 8.
These savings, totaling roughly 3 trillion rubles (about $41.1 billion), are currently managed by the state-owned Vnesheconombank (VEB). Under the proposed plan, citizens would not need to sign any new agreements; the conversion of their accounts would occur automatically.
Igor Shuvalov, the head of VEB, confirmed on June 3 that a new state-controlled fund is being established to oversee these long-term savings.
"The VEB group will 'gain access to additional financial resources to operate, including citizens' long-term savings and pension funds,' and will be able to 'invest these assets into modern technological projects,' Shuvalov explained."
The state-owned bank VTB, which already manages 1.3 trillion rubles (about $17.8 billion) in pension assets, may partner with VEB on this project. VTB head Andrei Kostin noted that while discussions are ongoing, a final decision on merging the pension structures of VEB and VTB is still pending. The proposal is currently under review by the presidential administration, the Main State Legal Directorate, the Central Bank, and the Ministry of Finance.
Finance Minister Anton Siluanov expressed support for the bill on June 4. He stated that the funds held in the Social Fund, including those belonging to the "silent" investors, could serve as a foundation for long-term savings.
The long-term savings program was introduced by the Ministry of Finance and the Central Bank in 2024 as a replacement for the stalled pension system. Officials intended for these assets to be invested in the domestic stock market, which lost access to foreign investors following the onset of the war.
In the first nine months of 2025, Russia spent $146.4 billion from its budget on military expenditures—four times more than it had in 2021—which accounted for 39% of total government spending.
As military costs rose, civilian spending shrank, and the current budget allocated just 25.1% to social needs, marking the lowest level in two decades.
In total, the state directed $522 billion in taxpayer funds toward the war effort between 2022 and 2025, an amount that could have otherwise financed the entire higher education system for 24 years or supported federal healthcare for 22 years.
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