Armenia weighs response as pension reform drives young academics from state universities
Armenia’s effort to overhaul its pension system has triggered a wave of departures from state universities and research institutes, and the government has yet to take steps to stem the loss of young specialists. Under the new system, workers born after 1973 are required to earn most of their future pensions by contributing sums equivalent to 10 percent of their gross wages to private pension funds until retirement.
Introduced in January, the reform met fierce resistance from many affected Armenians—most of them in the private sector—and was effectively blocked by the Constitutional Court in April. The government then made the plan mandatory only for 65,000 or so public sector employees.
A bill approved by parliament in June allowed people employed by private entities to postpone participation until July 2017, an option most private sector workers are believed to have taken. But employees who also hold part-time public sector jobs are denied that choice, with tax authorities also making sizable deductions from their wages paid by private employers.
Among those affected are young academics and scientists. Several dozen have quit state-run universities and research centers affiliated with the Armenian National Academy of Sciences to avoid the extra tax. Yerevan State University alone has lost 33 scholars to date, and officials there fear dozens more could follow.
At least nine lecturers aged 40 and younger have left the State Engineering University of Armenia. SEUA Rector Hovannes Tokmajian said on Thursday the outflow is undermining the university’s “strategic plan” to recruit more young staff and raise educational standards.
He and other state university leaders conveyed their concerns to the government last month. Prime Minister Hovik Abrahamian instructed the Finance Ministry to consider proposing amendments to the law regulating the pension reform. A Finance Ministry spokesperson said the issue remains “in a discussion phase.” Science and Education Minister Armen Ashotian, who shares the universities’ concerns, said he is also awaiting government action.
He and the university rectors have proposed that tax authorities make deductions only from scholars’ wages paid by state institutions. Universities warn that without changes, the policy will continue to push young talent out of the public higher education sector, complicating efforts to improve teaching and research standards.