Pension Reform Controversy: President signs amendments to law despite activists’ call for veto

Another unconstitutional law has been ratified, activists of a civil group opposed to the controversial pension reform claimed late last week after President Serzh Sargsyan signed the amended legislation on Friday.

Members of the Dem.am civil initiative had called on Sargsyan to veto the reform package that they said did not meet the public’s interests and violated people’s constitutional rights.

Under the new amendments to the Law on Funded Pensions, beginning on July 1, public sector employees born after 1973 will be required to make monthly “targeted social payments” in the amount of five percent of their salaries. These payments come to replace the pension contributions that the law envisaged in its former edition and because of which it was recognized as unconstitutional.

Unlike pension contributions that were to have been made directly to private pension funds, the new “targeted social payments” will be made to the state budget. Participating in the new pension system will remain an option for private sector employees until July 2017 when they will also be required to start making additional social payments.

In its statement on Friday Dem.am also claimed that the parliamentary majority represented by the Republican Party of Armenia (RPA) led by President Sargsyan adopted the changes to the law by violating the procedure as some lawmakers voted for their missing colleagues. The claim was first made by members of the opposition immediately after the June 21 ballot. In particular, Dashnaktsutyun party MP Aghvan Vardanyan noted that only 64 RPA members were in the chamber, but the RPA “yea” votes eventually stood at 67, which ensured a narrow passage of the legislation in condition of the minority factions opting out of the ballot. (At least 66 lawmakers must take part in ballots for them to be considered valid).

Dem.am activists called for a halt to the campaign on promoting what they described as an “antisocial law”. “Otherwise, the gap between the people and the government will further deepen to prove that the RPA is no longer capable of solving problems facing Armenia and that Armenia is being governed not by democratic principles, but by the priorities of narrow party and sectional interests.”

Earlier, representatives of the parliamentary minority did not rule out another application to the Constitutional Court regarding the amended legislation on pensions.