Retirement pensions and social benefits paid to poor families and needy elderly people in Armenia are expected to be slightly raised next year, it emerged after a government meeting on Thursday.
The meeting of the Cabinet chaired by Prime Minister Tigran Sarkisian discussed and approved a draft budget for 2012, calling for 910 billion drams (nearly $2.5 billion) in revenues and more than a trillion in total spending, with the budget deficit set at 132.5 billion drams (about $360 million).
The figures mean that the budget’s revenue pattern will grow by about 60 billion drams (more than $160 million) over last year’s index, while the expenditure pattern will grow by 40 billion drams, or nearly $110 million, against what it has been this year.
According to Deputy Finance Minister Pavel Safarian, average monthly social benefits in 2012 will be raised by 2,700 drams (about $8) -- from current 26,800 to 29,500.
“Average retirement pensions will grow by about 3,000 drams, that is to become 31,300 drams,” said the official, stressing that ‘sizable allocations’ will also be made for other social spending.
Prime Minister Sarkisian elaborated that in 2012 Armenia will see its first-ever ‘wage reform’.
“Civil servants will be provided with a social security package and will have an opportunity to avail themselves of this package in 2012, in particular to pay for interest on their mortgage, to cover their medical expenses by means of insurance policies… They will also be enabled to pay the tuition fees of their student family members,” explained Sarkisian.
Remarkably, more than 96 percent of the entire revenues of the draft budget are expected to be generated through taxes. State Revenues Committee Chairman Gagik Khachatrian expressed his concerns in this regard.
“It is very important that an explanation be presented for the revenue pattern of the budget that stipulates an unprecedented rise, with forecasts for the development of industries of the economy. Unless there is such a document, we cannot know which branch of the economy is expected to produce a high rate of growth,” said Khachatrian. “No such growth in post-crisis conditions has ever been stipulated by any state budget in the history of Armenia, that’s why we have serious concerns in this regard and serious work is required on this document.”
At the discussion, Prime Minister Sarkisian also reported that a tax package has been developed jointly with the International Monetary Fund that provides for exposing a number of fields that have not been taxed before. This, according to the head of the Armenian government, will make it possible to redistribute more financial means through the state budget.