Consoris Consulting takes an active part in projects aimed at assessment, increasing the potential and efficiency of reforms in Ukraine. We provide actuarial services for the companies that carry out research at the national level that require data analyses, modelling and verification.

An assessment of consequences of the contributory pension system introduction tab_img

In 2015 the Consoris Consulting’s team of actuaries and analysts took part in a public debate about draft laws on reforming the pension system of Ukraine.

Main aspects of the draft laws:

  • Ensuring financial solvency of the PAYG system.
  • Launching an accumulative system of pension insurance.
  • Development of non-government pension systems.

In the framework of the new law drafting, it was important to forecast the effects on the economy, public welfare, market development and investment climate.

The law provisions envisage an engagement of a qualified actuary for ensuring sustainable and smooth functioning of the pension funds. The gained experience in actuarial assessment of the long-term pension liabilities in accordance with IFRS (IAS) 19 having been taken into account, we were engaged in analyzing and modelling of the alternative scenarios of the pension system transformation using econometric approaches and tools.

We have developed an adaptive actuarial model and implemented a software solution with the functional interface that enabled us to perform a wide range of tasks:

  • Modelling social and economic consequences of the Ukrainian pension system with room for modifications according to the reform options.
  • Carrying out a statistics analysis, making forecasts of the socio-demographic situation in Ukraine and identification of main trends for the model’s maximum adaptation under real conditions.
  • Emphasizing the results that reflect positive and negative consequences of the reform options implementation.
  • Studying an impact of macroeconomic, social, demographic and political factors on the pension system efficiency.
  • Identification and assessment of the Pension Fund budget deficit risks and the corresponding decrease of the socially vulnerable population groups’ income, etc.

The assessment of the model sensitivity has shown strong influence of the input data and long-term forecasts on the results. Therefore, the input information has thoroughly been analyzed and adapted by the actuaries of Consoris Consulting in close cooperation with other participants of the pension reform discussion process, i.e. the World Bank, the Institute for Demography and Social Studies of the National Academy of Science of Ukraine, the Pension Fund of Ukraine, the Research Institute of Labour and Employment of the Ministry of Social Policy of Ukraine and the National Academy of Science of Ukraine.


The results of our calculations enable the involved experts to analyze the consequences of various scenarios of the pension system reform. Our models help evaluate the influence of the reform on the pensioners’ welfare and the state financial institutions balance. They can be used in practice for drafting the documents on the pension system transformation.
Life cost and total road accident cost estimates tab_img

The problem of road injury and mortality is extremely acute in Ukraine. Our country stands at the top of the list of European countries in this regard. In the last three years the number of those killed in traffic accidents has amounted to 15 thousand people. It has become one of the key social problems.

The Consoris Consulting experts have taken part in a project on working out a mechanism of life cost calculation per a Ukrainian citizen and estimation of road accident costs for the country should a person dies in a road accident.

Road accident costs for the state were considered from the point of view of the following aspects:

  • economic losses in terms of lost GDP;
  • the State budget and Social Insurance Funds’ losses in terms of lost tax revenues from private persons;
  • funeral costs incurred by the family of the deceased;
  • the State budget and Social Insurance Funds’ losses in terms of paying survivor benefits, disability pensions, temporary disability benefits, costs of hospital treatment for the injured, costs of state education for the children of a deceased, costs for reconstruction of the damaged road and its elements.

In the course of the calculation model realization some improvements were introduced into the chosen methodology aimed at its enhancement.

Our specialists have also analyzed the world best practice and Ukrainian insight into the life costs estimation, which enabled us to assess the chosen methodology from the point of view of its integrity and multidimensional nature.

We have carried out work on consolidation of information from different sources of economic, social and other spheres of life, its processing and adaptation to the set task. The quality of input data has a considerable impact on the assessment results. This is the reason why the actuarial report has reflected the calculation model sensitivity to the changes of the input parameters and assumptions.

Consequently, an assessment of the total socio-economic road accident costs for the state was made. The results presented in our actuaries’ report can be further used for forecasting and analyzing the dependence of financial effects from expenditures for road situation improvement on a national scale.
Draft laws study - a government’s loss burden assessment in the part of preferential pensions tab_img

In 2017 the Ukrainian government was carrying out a PAYG pension system reform. Our company studied and analyzed the government bill and the alternative members of Parliament’s drafts on the pension reform submitted to the Verkhovna Rada of Ukraine (the Parliament).

In the course of the law making we were providing consultations for the experts and MPs on different aspects of the pension reform.

In particular, we have conducted in-depth analytical research into the proposed initiatives on financing preferential pensions for workers in hazardous jobs (the so-called Lists #1, 2). Using its long-term experience in actuarial assessments of corporate preferential pension liabilities in Ukraine according to the IFRS (IAS) 19, Consoris Consulting has developed new assessment models to estimate the impact  of proposed initiatives on the financial strength of the Pension Fund of Ukraine and for forecasting other possible consequences. The following steps were made to pursue the above:

  • Accumulation, requesting and studying the available statistical information and forecasts of macroeconomic, social and demographic rates from different sources. Data preparation for modelling.
  • Development of flexible multifactor models with various levels of input information detalization suitable for changing the parameters and application of optimistic and pessimistic scenarios.
  • Analysis of model sensitivity to alteration of the main contributors and key parameters.
  • Making calculations upon the developed models using all necessary actuarial principles based on compliance with the strict requirements of the international financial reporting standards.
  • Results visualization for illustrative purposes, plotting flow charts of the Pension Fund’s expected payments, revenues and deficit.

The performed actuarial calculations have revealed some legislative initiatives to be not of economic benefit for the state, because, having been introduced into the PAYG pension system, they could cause some additional risks of financial fragility. The lifespan of such risks is considerable – dozens of years, and, therefore, it could cause the Pension Fund’s budget imbalance, which entails additional financing from the state budget. Also, over a long-term period the workers in the hazardous jobs might face risks of unfair eradication or reduction of their rights for preferential pensions, previously guaranteed by the state and secured in legislation.

Our actuarial calculations have been introduced to the government policy-makers, representatives of the Ministry of Social Policy, MPs, scientific and expert community and the concerned NGOs.

The resulting draft law has been adopted as amended and supplemented pursuant to the results of the performed calculations. It was recommended to further elaborate on the topic in 2018. In times to come it is possible to build new expanded forecasting models for actuarial justification of the pension reform using more detailed input information.