Armenian Ruling Party Blocks Pension Reform Debate

YEREVAN — The ruling Republican Party of Armenia (RPA) 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. Despite earlier indications to the opposition, the ruling Party informed the National Assembly leadership that it did not find it expedient to participate in the special session.

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 law is to become effective on January 1, 2014 implies that all citizens born after 1974 shall transfer five percent of their monthly salaries to one of several pension funds. This provision of the reform aroused protests from thousands of citizens. Nearly 8,000 people have already joined a Facebook group campaigning against the application of the provision.

Armenia’s three main opposition groups as well as the opposition-leaning Prosperous Armenia Party 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.

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 Republican party deputies making up the parliamentary majority. The opposition minority was quick to condemn the RPA boycott as a “blatant disdain” of the Armenian constitution.