Azerbaijan's Labor Minister talks about revision of pensions, childcare allowance
By Kamila Aliyeva
Azerbaijan plans to revise the amount of childcare allowance up to three years.
Minister of Labor and Social Protection of Population Salim Muslimov made the remark while commenting on the proposals made at the parliament for increase of this allowance during the second day of the meeting on the draft state and consolidated budgets for 2018.
In general, the ministry is reviewing the whole mechanism of targeted social assistance, according to the minister.
"We are studying the experience of different countries and within the framework of this process we also plan to revise the allowances for children under three years old," Muslimov said.
Currently, Azerbaijani citizens have the opportunity to receive benefits for a newborn. This amount is paid monthly until the child reaches the age of three. In certain cases, the sum of allowance is doubled. The amount of the allowance for each child up to 1.5 years is 30 manats, from 1.5 to 3 years - 15 manats.
The minister further talked about pensions expenditures, noting that a special government commission will be created in Azerbaijan to calculate pension expenditures in the near future.
He recalled that after the last amendments to the labor legislation, the concept of transfers to the State Social Protection Fund disappeared. Instead, the concept of ‘state budget obligations’ was introduced.
"There is a clear division of pensioners. The pension obligations that were formed before 1992 are now considered obligations of the state budget. During the six months, a special government commission will examine the documents of each of the 1.3 million pensioners to find out the experience of each of them," the minister said.
He added that with the exception of allowances for civil servants and servicemen, the government will provide 228 million manat per month for pensions.
The changes also affect the indexation of pensions, according to Muslimov.
"If earlier the pension was divided into the basic and insurance part, currently such concepts do not exist, and the indexation in 2018 will affect the entire amount of the pension," he noted.
Azerbaijani President Ilham Aliyev on May 2, 2017 approved amendments to the law "On Labour Pensions".
The amendments provide for the elimination of the concept of the basic part of the labour pension and the 12-year service required for the appointment of a pension, as well as the gradual increase in the retirement age for women and men up to 65 years.
The retirement age will increase every six months until 2021 for men, until 2027 for women. In view of the elimination of the concept of "basic part of the pension", the law introduces the concept of "minimum pension". The size of the minimum pension from January 1, 2017 is 110 manats.
Another change is connected with the compulsory social insurance. So, now 90 percent of the deductions paid by employee on compulsory state social insurance will be reflected in his/her account.
Deductions are formed from two sources: the deductions made by the employer in the amount of 22 percent of the salary fund of the enterprise, and the deductions worth 3 percent of the employee's wage. Formerly, only 50 percent of these deductions were reflected in employee’s account.
The law comes into force from July 1, 2017 and does not affect persons who retired before that date.
---
Kamila Aliyeva is AzerNews’ staff journalist, follow her on Twitter: @Kami_Aliyeva
Follow us on Twitter @AzerNewsAz