In Armenia the pension system is a pay as you go, PAYG, system, where current employees make contributions to the pension system and these contributions are used to fund the benefits of current retirees. When current employees retire, future employees would make contributions to the Social Security system and based on these contributions the future retirees would collect retirement benefits. This implies that the PAYG system is based on the solidarity principle between generations. It is also based on the solidarity principle within generations, because high income earners subsidize the benefits of low
income earners.

It is generally accepted that the current pension system has some weaknesses and needs improvement. For more information on this, please, download AIPRG Report bellow.

Sponsors: The Central Bank of Armenia, The World Bank and The USAID more>>