Parliament votes to amend controversial pension system at first hearing

The parliament adopted the bill on amending the law on accumulative pensions at first hearing today. 79 MPs voted in favor, 2 voted against and 7 abstained.

“We’ve always opposed the mandatory component, we haven’t changed our stance. By discussing with our colleagues, we will vote in favor, but with a condition to continue discussions with the government to abolish the mandatory component,” Naira Zohrabyan from the Tsarukyan faction said, referring to the controversial pension system whereby citizens born after 1974 were mandatory automatically added to the accumulative system, and subsequently charged percentage from monthly salaries.

The ARF faction said it will abstain from voting since “the bill contains improvement but doesn’t solve the important issue, which is abolishing the mandatory part”.

Edmon Marukyan from the Yelk faction said they will vote in favor, since it “is an urgent step which must be done. But discussions must continue”, he said.

Under the law, the accumulative pension’s mandatory component will be fully initiated, with an additional 80,000 citizens being added to the system. However, under the amendments, citizens will be taxed 2,5% instead of the previous 5% of their monthly salaries for the pension system. The government will cover the remainder, which is 7,5%. Previously citizens were taxed 5% and the government covered the remaining 5%.