Tuesday, July 2 2019 19:23

ArmInfo.Former First Deputy Minister of Finance of Armenia Pavel Safaryan sees certain risks that may arise as a result of an increase in the minimum wage. He curled  about this on July 2 in an interview with journalists, answering the  question ArmInfo.  

Safaryan, as the former person in charge of the  Ministry of Finance, is ambiguous about the latest increase in the  minimum wage. He said that for the last salary increase in 2015, it  took an additional 80 billion drams to be allocated. "At that time,  some thought that it was possible to organize a gradual increase in  salaries, since it was very difficult to take the bar high right  away. Then, in particular, salaries rose over 30% of state  officials," Safaryan said.

Meanwhile, according to the economist, there are always risks. They  can be in the form of insufficient economic growth, problems with tax  collections. "But when financiers propose an increase in social  budget items, they first count all sorts of economic risks," he said.

Recall that on June 27, the cabinet approved a bill to raise the  minimum wage from 55 to 68 thousand drams. However, the base salary,  on the basis of which the salary of most state employees is  calculated, will not change. The size of the salary of 45 thousand  workers in the private sector and 35 thousand civil servants who  receive the minimum wage will be changed. Their salary will increase  by about 23-24%.  Since July 1, the salary of servicemen has been  increased, and since September 1, teachers' salary increases are  planned.

Meanwhile, the ex-government of Armenia has repeatedly stated that  under current conditions, increasing pensions and the minimum wage  mean a risk of increasing the country's debt burden. As stated on  February 12, 2018, the former Deputy Minister of Finance, and now the  Minister of Finance Atom Janjughazyan, it would be opportunistic to  raise pensions without having a solid economic basis and reliable  sources of financing. He noted that "I would not like to return to  the practice of those years when the numbers on the paper were on the  rise, but in reality there were no resources for corresponding  payments." Meanwhile, the minimum wage was last revised in 2015 -  from 50 thousand drams to 55 thousand drams.  The previous increase  in the minimum wage took place in January 2014 - from 45 to 50  thousand drams. A year earlier - from 35 to 45 thousand drams.