Wednesday, 18 September

Armenian Parliament Adopts Amended Law on Funded Pension



A bill on making amendments to the Law on Funded Pension was adopted by Armenia's parliament at its second reading today with 67 votes in favor, 18 opposed, and 29 abstentions. 

Voting against the bill proposed by government were the Rule of Law, Heritage Party, and Armenian National Congress (HAK) factions, with the exception of HAK MP Hrant Bagratyan, who abstained. The Prosperous Armenia Party (BHK) and the Armenian Revolutionary Federation (Dashnaktsutyun) factions also abstained, with the exception of two BHK lawmakers who voted against the bill. BHK MP Vartan Oskanian did not participate in the vote, though he was present in the room.

Note, the amended law allows for employees in Armenia to opt out of the mandatory component of the funded pension system by submitting a written request to their employers. The Law on Funded Pension, which came into effect on January 1 this year, initially required all employed citizens in Armenia born after 1973 to pay 5–10% of their monthly gross wages to private pension funds. The law proved to be quite unpopular, resulting in numerous street protests. In December, dozens of MPs from the four non-ruling parties in parliament filed an application with the Constitutional Court, arguing that several provisions of the new law were unconstitutional. The plaintiffs asked the Court to revoke the mandatory component of the law. 

On April 2, the Constitutional Court ruled that the mandatory component was unconstitutional, and the Armenian government and parliament were given untilSeptember 30 this year to revise the law to comply with the requirements of the ruling. 


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