YEREVAN. – The absence of stable and high-paying jobs impairs the pension reform in Armenia.

Non-pro-government Prosperous Armenia Party (PAP) MP Mikayel Melkumyan, who is also Deputy Chair of the National Assembly Standing Committee on Economic Affairs, told the above-said to Armenian News-NEWS.am.

Melkumyan commented on the mandatory cumulative pension plan, which came into force in Armenia on January 1, 2014. 

As per the PAP MP, the number of working citizens in the country is 1.2 million. But 437,000 of them are farmers, who do not receive salaries. Consequently, they cannot be included in the mandatory cumulative pension plan.

Another 160,000 Armenian citizens work in the trade and the service sectors.

“But unstable, shadow employment, and such shadow wages are quire considerable in trade,” Melkumyan noted.  

Another 83,000 people work in industry, which is more or less stable.

The employment in the education sector can be considered relatively the most stable. But there is a concern that he pension portfolio might be formed irregularly and at a slow pace.

In addition, Mikayel Melkumyan stated that a sufficiently in-depth economic analysis has not been conducted for at least the next several years. 

The new cumulative pension plan—which came into force on January 1, 2014—is mandatory for those born in and after 1974 and voluntary for those born before 1974. In line with this plan, 5 to 10 percent of the monthly salaries in Armenia will be deducted and mandatorily be allocated to cumulative pension funds; the latter will be reimbursed as pensions once a person turns 63 years old.