Shortchanged on Soviet Savings
Every election campaign, talk of refunding Ukrainians for their Soviet-era savings finds its way into the hearts of voters. Now that Tymoshenko has found her way back to government, it’s about time she walked the talk. But will she?
Under the Tymoshenko plan, each account holder will be entitled to an equivalent of $200 in compensation payments. According to earlier statements, only 60 percent of Ukrainians who held accounts with Sberbank, the Soviet savings bank, will be “fully compensated.” Deposits of less than 2,000 Soviet rubles will have priority. So, unless your savings put you south of 2,000 rubles, you’re a fat cat. Here’s a quote from PM Tymoshenko:
After an account check with Oshchadbank [the Ukrainian successor to Sberbank], everyone owed by the bank will receive up to 1,000 hryvnias in cash depending on the amount deposited. In the near future, we will allow the owners of lost savings to pay for consumer goods, utility bills, and other services out of their bankbooks.
So, if my parents had 6,000 rubles on deposit in the mid 80s, which could buy a Zhiguli, all they get is $200, a free haircut, and that's it? And you call that fair? And what about those coal miners and industry workers who had up to 20,000 rubles on deposit?
“This amount is approximately half of what was usually cited. We plan to initiate a comprehensive refund” is another cryptic quote. Exactly what indexation rate are we talking about? Does it reflect the time value of money? Does it take into account the value of a deposit at the time it was made, as measured by the chronologically equitable basket of goods and services?
For deposits made prior to perestroika and the ruble overhang of the late 80s/early 90s, there is no equitable indexation rate below 1:5, plus interest owed. In other words, once we arrive at CPI figures, one Soviet ruble of savings should at least translate into five Ukrainian hryvnias. A deposit of 1,000 Soviet rubles made in December 1981 does not equal a deposit of 1,000 Soviet rubles made in December 1991.
In fact, there is no economic vehicle for turning around the issue of “lost” Soviet-era savings without righting some of the wrongs of the privatization/grabitization era.
By law, every Ukrainian citizen received a piece of paper called the “privatization certificate,” a legitimate ownership claim on Soviet public property. But somehow only a fraction of Ukrainians received value for their claims — and some received billions of dollars worth of property. Why?
Unless this question gets some serious consideration, the idea of $200 as a compensation sounds as another bad joke. We’ve already heard the unfortunate suggestion of making the coal miner’s job a dream for every Ukrainian kid. And guess what — hardly a month passes by without a coal mine accident.