Life of a person, who worked for 58 years (video)
75-year-old Senina Melkonyan came to Yerevan Vernissage for the last time in order to sell her handicrafts and other items, which aren’t used at home. Starting from July 1, only artwork can be sold at Vernissage. Mrs Senina was offered to trade at “Hrazdan” fair, but in that case she won’t be able to go there on foot. “There I was able to earn 1000-3000 drams. There were days, when I took money from home in order to pay the area rent; one meter costs 300 drams, and the storehouse costs 400-500 drams, so 1000 drams was spent in that way, besides I used to go to work on foot,” Mrs Melkonyan told “A1+”. 
Senina Melkonyan lives with her 2nd category disabled husband; they don’t have children, “I have worked whole my life and what, what is the result; AMD 30 000 pension.” Suren Melkonyan, who worked at “Armelectro” for 42 years, receives AMD 56 000 pension, which is today considered above average. This family spends more on medicine than food. They spend large sums of money on utility payments, too. In winter months they pay about AMD 25 000 for electricity. The rest is spent on food and other payments. “After all we go to market, he waits for me while I do shopping and buy everything necessary for about 10 days, then we put everything in a car and come back,” tells Senina Melkonyan. The couple lives on Saralanj Street in Yerevan, where the doors of the house overlook the street, and it is real extreme to walk on narrow sidewalks. Mrs Senina’s close friend, Knkush Yeghoyan, lives next to their house. Every Saturday-Sunday they used to go to Vernissage together.79-year-old Knkush Yeghoyan lives alone. Her husband died; she doesn’t have children. She spends her AMD 39 000 pension only on food. “We bought everything together with my husband long ago; at present I cannot buy anything. I worked as a cook for 33 years at ‘Masis’ company; I worked for 15 years at bakery for free.” Collecting money during the whole year, she saves AMD 80 000 in order to buy 4 cubic meter firewood for winter, “1 cubic meter costs AMD 20 000, and I pay AMD 20 000 for breaking the wood… What can I do without firewood?” Her house is in an extremely comfortless condition. “When it rains, water leaks from the ceiling, I am afraid of standing here and working,” says 79-year-old pensioner Knkush Yeghoyan. The idea of safe old age has been on the bases of the recent pension reforms. The pension age in Armenian is 63, average pension is about AMD 41 000, the maximum amount depends on the work experience. Among 465 000 pensioners, women make up about 60 percent. The pension reforms are implemented in two directions; current- solidarity between generations, and multi-level pension system, which entered into force in 2014. It aims at ensuring targeting of the pensions. 
“The people, who have a right, should receive pension. During the recent years e-pension system has been implemented, as a result of which the lists are being filtered, corruption risks are decreasing, and, in essence, we are able to give opportunity of realization of the right to a pension to the people, who have that right prescribed by law. As a result, we are able to save billions of budget means, which are directed to increase in pensions,” said Anahit Galstyan, Head of Pension Department at the Ministry of Labor and Social Affairs. The amount of pension depends on three main dimensions, “It is the amount of basic pension, the value of one year work experience in case of less than 10 years’ work experience and in case of more than 10 years’ work experience. According to the current legislation, the amount of the basic pension is AMD 16 000, yet the value of one year work experience in case of less than 10 years’ work experience is equal to 800 drams, and if more than 10 years- 500 drams for a year.” The second direction of the pension reforms is the mandatory funded pension system, which must have been exercised starting from January 1, 2014 for all the citizens, who were born after January 1, 1974. According to the system, people getting less than AMD 500 000 salary, must have paid 5 percent of the salary, and the same amount must have been paid by the state, and in case of more than AMD 500 000 salary, fixed AMD 250 000 must have been paid. Large wave of protest rose against the system; “I am against” (Dem.am) civil initiative was formed. 
Mane Tandilyan was among the activists of the initiative, and she took to the streets with a clear understanding that the reforms cannot be mandatory. “It was renamed, called social payment, but it continues to be of mandatory nature, which means we invest and are forcibly deprived of our means entering into high-risk reforms,” noted Mane Tandilyan, member of “I am against” civil initiative and “Bright Armenia” party. As a result of public pressure, the Constitutional Court recognized a number of provisions of Pension system to be anti-constitutional, then according to the decision of the National Assembly (NA), from July 1, 2014, it became mandatory only for state sector employees. For the representatives of the private sector, who rejected the system according to their own application, the payment of the renamed social payment was postponed until July 1, 2017. This year the NA has made one more change; the system was postponed for one more year, by July 1, 2018, for the private sector. New Tax Code is intended to be implemented in 2018, by which the income tax levy from salaries will be amended; the income tax rate for employees, who receive up to AMD 120 000 salary, will slightly decrease, becoming from 24.4 percent to 23 percent, and the employees, who get from AMD 204.000 to AMD 2 million salary will start paying 2-7 percent more tax. “In our country, the burden of the income tax will heavily fall on the citizens, who receive more than AMD 200 000 salary, and it will rise with the salary. Again there is a unfair atmosphere, where those, who don’t pay, and those, who receive shadow salary, won’t be affected, and only the citizens, who have fair income, will be affected, those, who also carry the burden of their family, and, in general, there is no minimum threshold for those, who don’t make any payments,” says Mane Tandilyan. One of the authors of Mandatory funded pension system, the NA Republican Party of Armenia (HHK) faction member Hakob Hakobyan considers it to be natural that not all the forces must have approved this reform, and the society must have expressed its discontent. “Why? As it is natural; it is the matter of future of the society, which cannot react to all the phenomena unequivocally,” said the NA HHK faction member Hakob Hakobyan. He says that the result of this system cannot be seen in 2-3 years, “The result can be seen at least after 20 years, as the more money, the higher its effectiveness will be and, naturally, those, who do payments today, will receive pension at least after 20 years and will be able to compare.” 
Though Hakob Hakobyan considers this pension reform to be established, he voluntarily hasn’t joined the system. “I am not a participant, as I will receive special pension, and I think it will be enough for the pensioner to live.” At present the number of participants in the pension system is 146 000, 65 000 of whom are from the state sector and 81 000- from the private. “There are people, who have voluntarily joined the system; they are people born in 1964-1974, and people born after 1974. To put it in other way, more than 50 percent of the system are the representatives of the private sector,” noted Karen Hakobyan, Head of Securities Market Regulation Division at Central Bank of Armenia. The Mandatory funded pension system is comprised of 3 funds- high-risk, medium-risk or conservative, and low-risk or stable income. These three funds are governed by two international administrators- French Amundi-Acba Asset Management CJSC and German C-Quadrat. 
According to Karen Hakobyan, at present our pension assets make up AMD 41 billion, which are invested in different financial assets; 19 billion out of 41 billion are the allocations made by the people, another 19 billion is the co-financing by the state and about 3 billion is already ensured income got as a result of management of the administrators of the funds. “About 31 percent out of that 41 billion was directed to the financing of the RA economy; the RA bonds have been acquired with about 40 million and about 29 percent has been invested in different bonds and shares quoted in different international market.” He says that during two years about AMD 500 000 has already been accumulated on the funded account of a person, receiving average salary, AMD 180 000. “If a person works 20-30 years by the age of 63; it is a large amount of money, also to take into account that it is governed and ensures income. Our target is that a person receives 40-50 percent of his last salary as a pension until the end of his life,” said Karen Hakobyan. Before the age of 63, a citizen can withdraw his money from his account ahead of time in case of serious illness. In case of a person’s death, his descendants will receive that money.
