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Armenian Ruling Party Blocks Pension Reform Debate


Armenia - Opposition deputy Armen Rustamian addresses citizens protesting against pension reform outside the parliament building in Yerevan, 15Nov2013.

Armenia - Opposition deputy Armen Rustamian addresses citizens protesting against pension reform outside the parliament building in Yerevan, 15Nov2013.

The ruling Republican Party of Armenia (HHK) thwarted on Friday an opposition-initiated parliament debate on the government’s controversial reform of the national pension system fiercely opposed by many young and well-paid professionals.

Under a reform plan approved by the government years ago, Armenia has been gradually switching to a new system whereby the amount of monthly benefits paid to retired citizens will depend on their and their employers’ lifelong contributions to the fund. The existing pay-as-you-go system essentially does not differentiate between pensioners’ employment histories. The authorities in Yerevan say it is not sustainable because of the country’s aging population.

The pension reform is due to be essentially complete with the entry into force on January 1 of a set of legal amendments approved by the Armenian parliament earlier this year. They stipulate, among other things, that working individuals born after 1973 will have to transfer 5 percent of their income to state or private pension funds in addition to social security taxes paid by their employers.

This clause is causing growing protests from some categories of the population, notably white-collar workers employed in Armenia’s information technology (IT). Using online social networks, they have launched a campaign against the reform which they say will unjustly cut their wages without guaranteeing them decent pensions in the future.

Armenia’s three main opposition groups as well as the opposition-leaning Prosperous Armenia Party (BHK) have added their voice to these objections, saying that the authorities should at least delay collection of the 5 percent tax until the end of 2014. They say the reform is not only unfair but also unconstitutional.

Armenia - Pro-government deputies boycott an extraordinary sitting of the National Assembly, Yerevan,15Nov,2013

Armenia - Pro-government deputies boycott an extraordinary sitting of the National Assembly, Yerevan,15Nov,2013

In a rare show of unity, lawmakers representing the four parties collected earlier this week enough signatures to force an emergency parliament debate on the issue. It was scheduled for Friday.

The debate did not take place, however, as the National Assembly failed to make a quorum due to the absence of the HHK deputies making up the parliamentary majority. The opposition minority was quick to condemn the HHK boycott as a “blatant disdain” of the Armenian constitution.

“Whatever they will say, this means one thing: they don’t consider their arguments substantiated,” Naira Zohrabian, the secretary of the BHK’s parliamentary faction, told RFE/RL’s Armenian service (Azatutyun.am).

“This [government-drafted] legislative package raises many questions and, as we can see, the government and the parliamentary majority avoid answering those questions,” said Nikol Pashinian, an opposition deputy nominally representing the Armenian National Congress (HAK).

The parliament minority leaders also condemned the boycott when they addressed some 200 protesters, many of them IT specialists, who gathered outside the parliament building in Yerevan in anticipation of the debate. The crowd then marched to the HHK headquarters located elsewhere in the city center to express its indignation with the ruling party’s stance.

HHK leaders were clearly unfazed by the outcry, however, with deputy parliament speaker Eduard Sharmazanov saying that the opposition already had a chance to object to the reform on the parliament floor. “We passed this law after hearing their counterarguments,” Sharmazanov told RFE/RL’s Armenian service. “If they see any legal problems, they can go to court.”

Galust Sahakian, the HHK’s parliamentary leader, assured reporters on Wednesday that the parliament majority will not block the planned debate.
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