Armenian government to continue advancing pension reform

The Armenian government has issued a statement in connection with the Constitutional Court’s decision concerning the Law on Compulsory Accumulative Pension System, according to the press office of the government.

“The Constitutional Court stressed that experience of 50 countries shows that the introduction of the accumulative pension system improves the country’s stability and the well-being of its people. At the same time the court decided there are omissions in the law to be corrected by September 30”, the statement reads.

‘The government will advance – within the framework of the appropriate constitutional formulations – this radical reform aimed at improving the well-being of the people.

The government of Armenia will adopt a program of further actions after it receives and examines the decision of the Constitutional Court,” the government said in the statement.

The Constitutional Court of Armenia today recognized as unconstitutional a number of provisions of the Law on the Compulsory Accumulative Pension System.

The CC Chairman Gagik Harutyunian read the court decision saying that the use of the compulsory component restricts the application of a number of articles of the Armenian Constitution, in particular, the protection of citizens’ right of property. Besides, the law does not take into account the requirements to ensure the minimum consumer basket.

The decision takes effect upon its publication.

The Constitutional Court of Armenia ruled that the parliament and the government shall bring the law into line with the decision’s requirements by September 30, 2014.

We would remind you that the law took effect on January 1, 2014. It applies to Armenian citizens born after January 1, 1974. Under the law, employees have to pay 5% of their monthly salaries to a pension fund, and the state shall pay another 5%, but no more than 25,000 drams ($61).