TODAY.AZ / Society

Pensions to grow again

21 June 2019 [15:09] - TODAY.AZ

By Azernews

By Abdul Kerimkhanov

Following the latest steps taken on increasing the minimum wage index, Azerbaijan is the leader in terms of the minimum wage in the South Caucasus. However, the government does not intend to stop at the achieved results.

Starting from January 2020, pensions will increase by 15 percent in the country, said Sahil Babayev, Minister of Labor and Social Protection of the Population.

“The reform carried out in the pension system of Azerbaijan will cover 750,000 people, which means approximately 60 percent of all pensioners in the country,” he added.

Speaking about analysis of the dynamics of expenditures related to the increase in the minimum salary and salaries of people working in various fields, he said that no serious impact on inflation is expected.

Babayev explained that the expenses are covered by the growth of revenues to the state budget, and in comparison with GDP and retail trade turnover, their share is rather small.

He recalled that since March 2019, the minimum salaries have been raised.

“Although three months have passed, today the inflation rate in Azerbaijan is 2.5 percent. This is the proof that there is no serious inflation. But, in any case, this question is under control, as required by macroeconomic policies,” the minister said.

In addition, Babayev announced the sources of funding for the second social package approved by President Ilham Aliyev.

The minister said that the size of the financing of the second social package is 660 million manats ($388 million). Of this, as many as 560 million manats ($329 million) were allocated from the state budget and 100 million manats ($59 million) from the State Social Protection Fund.

“These budget funds were accumulated thanks to tax and customs revenues,” Babayev added.

Earlier, President Aliyev signed an order on raising the minimum monthly wage, which is now set at 250 manats ($147). Thus, the minimum wage will exceed the subsistence minimum (180 manats or $106) by 40 percent.


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