Armenia increases social security payouts for those who have never worked

Armenia has increased old-age, social security payouts for people who have never worked. Now, instead of the previous 16 thousand drams ($33), they will receive a pension of 25,500 drams ($52.5) from the state.

How many people will be affected by the reform?

About 85,000 Armenian citizens will receive two months’ backpay (up to 1 January 2019) for the increase of the monthly payout.

Among the recipients are those who have never worked, as well as citizens who have work experience but receive a pension of less than 25,500 AMD ($52.5) per month, said Deputy Minister of Labour and Social Affairs of Armenia Smbat Saiyan.

Saiyan says the main goal of the initiative is to eliminate extreme poverty among pensioners:

“There are about half a million pensioners in Armenia, of which 17 thousand have a pension below the minimum threshold of extreme poverty.”

The last time pensions and benefits increased in Armenia was in 2015. Then, the increase was about four dollars a month.

Who else will be affected?

Saiyan said that the increase will also affect people with disabilities.

He noted that previously the method of payments to people with different disabilities was unfair – everyone received the same amount, and the only difference was in the number and names of medicines that were provided to them free of charge.

“Under the new bill, it is proposed to increase benefits by 40% for citizens in the first disability group, and by 20% for persons in the second disability group. Thus, the amount for persons in the first disability group will increase by 6,400 drams [$13], and for those in the second group it will increase by 3,200 drams [$6.50],” said Saiyan.

These reforms will cost the state 110 million AMD, approximately $2,724,000 a year.

Other reforms 

At the beginning of the year, the Armenian government adopted a bill according to which people will not lose their right to receive family or social benefits due to an increase in old-age pensions, disability benefits or in the case of a loss of a family’s main earner.

Arsen Manukyan, then Deputy Minister of Labour and Social Affairs, explained why this decision was made:

“There is a risk that most [vulnerable] families may lose their right to social benefits. For example, the size of payments may increase by 4 – 6 thousand drams [$8 – 12] because of which the family will lose 18 thousand drams of social benefit [$37]. But thanks to the above-mentioned changes, this will be avoided.”