Family aid in Belarus: who will benefit more?
Alyaksandr Lukashenka has approved the project Big Family – the state will pay 10 thousand dollars for the third child and for every other child born into the family afterwards. The money will be deposited to the Bank of Development and will be given to the family when the child turns 18. The inflation rate will be taken into account.
The family will get about 14 thousand dollars when the third child turns 18. It makes about 2% of the annual interest rate, economist Syarhei Chaly says.
"It means that Rumas (head of the Bank of Development – Euroradio) will get a sum that will cost him 2% of the annual interest rate. However, the real annual interest rate in the internal market is 6.5-7% and even more in the external market.”
The conditions are very profitable – nobody will withdraw the money with a 2% annual interest rate for 18 years.
The idea is not new. Uladzimir Nyaklyayeu suggested it during his last pre-election campaign. However, everyone said that it was impossible, the ex-candidate’s deputy Andrei Dzmitryyeu noted.
"The presidential election campaign is approaching and Lukashenka is getting ready for it. Lukashenka and his structures have made use of our ideas many times. However, the things we do and talk about help us make life better and this is good. We suggested depositing money for every second child. But they told us it was impossible as there was no money for it. Now there is.”
Where has the money come from? Lukashenka has suggested increasing the income tax by 1%. It is an extra 236.5 million dollars a year. There are about 65 thousands families with three or more children in Belarus. It means that $3638 will be spent on every such family a year. The ten thousands paid by the state for the third child will pay its way in four years.
The Bank of Development can even make money on the state support. If the money was deposited to, say, Belarusbank using the deposit Classic Plus for 18 months, it would be possible to make 856 dollars.
It could be done 12 times in 18 years and it would make 26 thousand dollars and you would only have to give away 14 thousands.
However, the bank will use at least the 8% annual interest rate for ‘maternity deposits’, Syarhei Chaly thinks. The sum would increase to $39 thousand in 18 years. 14 thousands would be given away and the profit would be 25 thousands.