UITE warns that pension reform would spur out-emigration of Armenians

UITE warns that pension reform would spur out-emigration of Armenians

YEREVAN, February 12. / ARKA /. An organization founded to protect the interest of IT sector has joined today thousands of Armenians protesting against a new pension scheme, effective from January 1.

Karen Vardanyan, head of the Union of Information Technology Enterprises (UITE), warned that the reform would increase out-emigration of young Armenians and deteriorate further the social woes of the population.

In particular, he singled out the mistrust about how pension contributions will be managed, arguing that the law must be revised to allow citizens to claim their pension savings back in case of need in advance by paying a certain fee. This would dissipate the mistrust of people into the new scheme, he said. 

“Today, the state acts as an overseer forcibly taking people's money and sending them abroad, " said Vardanyan 

He disagreed that the protests against the new pension scheme are politicized saying the citizens fight only for their rights.    

But a political analyst Vigen Hakobyan warned that the protests against pension reform sooner or later will be politicized. He said  the Constitutional Court suspended some provisions of the law to simply defuse the tension and will never  make a decision running counter to the country's ongoing  political strategy.

The Constitutional Court suspended, particularly, Article 76 of the new law, which provides for penalties for failed or delayed pension tax payments, and the third paragraph of Article 86, which obligates employed citizens to choose a pension fund, among other parts of the law. The Court says it will conclude the inquiry on March 28, 2014.

The constitutionality of the law was challenged by three opposition parties in the National Assembly — the Armenian National Congress, the Armenian Revolutionary Federation, and the Heritage Party — along with the usually pro-government Prosperous Armenia Party.

The new pension system requires that all Armenian citizens born after 1973 pay social security taxes equivalent to 5 percent of their monthly wages, which will be matched and doubled by the government. 

That money has to be deposited with private pension funds licensed by the government late last December. They are Amundi, which was set up by French banks Credit Agricole and Societe Generale, and Cologne-based Talanx Asset Management, a subsidiary of German insurance firm Talanx. -0-

16:58 12.02.2014

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