Azerbaijan, Baku, May 23/ Trend I.Khalilova /
State Social Protection Fund of Azerbaijan does not see the need to reduce the rate of compulsory social insurance in 2010, said Deputy Chairman of the Fund Zakir Babayev.
"The gross rate of the compulsory social insurance of 25 percent is much lower than other CIS countries and Europe, so we do not consider it appropriate to decrease rates," said Babayev.
The main goal is to create self-financing system of social insurance by 2015. In this regard, it is intended to minimize transfers from the budget. If over the last two years (2007 and 2008), transfers were increased in connection with the task of bringing the minimum amount of labor pension to the cost of living, later a gradual reduction started in the transfers. Currently the base of the labor pension is 75 manats (this year a decision was not made on increasing the minimum pension, while in 2009 the cost of living has increased from 70 manats to 84 manats. For the working population, this plank is 92 manats, pensioners - 65 manats and children - 69 manats).
Due to the reduction of transfers from the Public budget, still the government sees no need to reduce the rate of social transfers and correctly considers it correct to change the ratio of the rates of social payments by employers and employees under the Pension Concept.
State Social Protection Fund supports decreasing rates for employers and increase the rate of transfers from wages of employees, according to the experience of several CIS countries and leading Western European countries.
Meanwhile, in order to build a self-financing system of social insurance, it is impossible to lower the social rates so quickly. Presently the rate of transfers for compulsory social insurance is formed from two sources. Employers are implementing transfers for social insurance in the amount of 22 percent of salary fund, and 3 percent from salaries of employees. The minimum wage is 75 manat.
Since 2008, the rate of transfers for social insurance has been reduced for persons engaged in entrepreneurship activity without establishing a legal entity, and a single rate was made for the landowners. Upon the current Law on Social Insurance, individual entrepreneurs engaged in trade, transport, construction, monthly pay 50 percent for compulsory social insurance compared to 70 percent of the minimum wage, but in other spheres of activity - 20 percent (40 percent).
For family farms, the rate was established at 6 percent of the minimum wage.
Official exchange rate on May 23 is 0.8036 AZN/USD.
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