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Government Again Raises Tiny Pensions


By Atom Markarian
The Armenian government announced Thursday another increase in its modest retirement benefits, in a move reflecting the approaching presidential and parliamentary elections.

Officials said after a weekly cabinet meeting that the average monthly amount of a state pension will increase by 700 drams ($1.22) and equal 6,700 drams starting from January 1. “In 2003, the average pension in Armenia will be 50 percent higher than at the beginning of this year,” the head of the government’s Pension and Employment Fund, Frunze Musheghian, told reporters.

This is the third pension rise approved by ministers this year. Nevertheless, Armenian pensions will continue to be among the lowest in the former Soviet Union. With the unofficial subsistence level estimated by economists at $40 a month per person, the latest increase will hardly bring a significant improvement to the lives of some 480,000 Armenian pensioners, most of them impoverished since the Soviet collapse.

Still, analysts say the current authorities hope to win over many pensioners ahead of next year’s elections. Musheghian stressed that the government has eliminated all pension arrears this year. “The fund’s expenditures envisaged by the 2002 budget are done on time,” he said.

The government’s draft budget for next year sets aside just 3.5 billion drams ($6.1 million) for payment of state pensions. Another 3.7 billion drams will be contributed by the pension fund.

The Armenian military, by contrast, is expected to receive 46 billion drams in 2003. The government’s total net expenditures are projected at 334 billion drams. Its proposed budget also calls for a 2.8 billion-dram cut in social benefits to low-income families.
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