Issue in the Accumulation System: The Government is Not Paying Its Share

In the mandatory accumulation pension system, there has been an issue for quite some time. The newspaper "Hayots Ashkharh" has recently received calls from citizens reporting that the government is not fulfilling its payment obligations. As is known, 10% of an employee's salary is supposed to be accumulated as a future pension. Part of this 10% is paid by the worker, while the other part is covered by the government. However, it appears that the government has not been meeting its share of the obligation for more than a month.

The newspaper turned to the Ministry of Finance of the Republic of Armenia to inquire about the reasons for this delay. In response to our inquiry, the Ministry indicated the following: “The Ministry of Finance is aware of the issue. As early as this August, the funds allocated in the state budget for the 'Introduction of the Accumulation Pension System' expenditure program have been insufficient to meet the financing of this program. However, based on the Government’s decision No. 1599-N dated 30.09.21, the issue has been resolved, and as a result, an additional 20 billion dram has been allocated to the main administrator of the program, the Ministry of Labor and Social Issues of the Republic of Armenia. This decision came into force on October 1 of this year, and the payment will be made from the RA state budget in the upcoming one or two days.”

It is good that the issue will be resolved in the coming days, but on the other hand, citizens have already lost trust not only in the government but also in the mandatory accumulation pension system itself,” the newspaper writes.