Social Protests in Armenia: Gas Cocktails and Pension Future

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Social Protests in Armenia: Gas Cocktails and Pension Future

Right after the New Year, the citizens of Armenia were shocked by the gas and electricity bills for December. An increase in prices took place in July 2013, but in such a cold winter, not quite typical of Armenia, more energy had to be used for heating, and only now the additional 18% and 27% of gas and electricity bills became tangibly burdensome.

Gas quality also aroused dissatisfaction. As it is said, all three came in one. Numerous Facebook users composed statuses and made comments that a lot of gas was being consumed, while the apartments still remained so cold that one had to switch on electric heaters as well. “Gas is so inefficient that by the time my morning coffee gets ready, I already manage to take a shower and shave,” a Facebook user mentioned.

Many people began to talk about the questionable quality of gas fuel. The press even put forward different versions of gas cocktails (gas is mixed with air or water) or gas supply being under insufficient pressure.

The “ArmRosgazmprom” company, which has recently been renamed “Gazprom Armenia”, responded with a statement introducing standards of gas fuel, supplied to Armenia during the cold months, and even offered to hold a special joint expertise. However, such statements did not seem reliable to Armenians, since laboratory studies had to be conducted at the very same company.

This distrust also increased as a result of the events that occurred on the eve of the New Year. At the end of 2013 the governments of Armenia and Russia signed a gas agreement by which the Ministry of Energy and Natural Resources of Armenia pledged to transfer 20% of shares of “ArmRosgazprom” to “Gazprom” by January 31, 2014. The reason of the deal was said to be the Armenia's national debt, amounting to $300 million for the Russian gas. The agreement will be in force until December 31, 2043. Over the next 30 years “Gazprom Armenia” will have exclusive monopoly over gas, supplied to consumers in Armenia. The gas imported to our country cannot be exported, while the Armenian side should ensure the immutability of the agreement. The signing of this document caused a political and social discontent mainly because the government has failed to propose a convincing explanation on how, when and why a public debt of 300 million dollars accumulated. And most importantly, why was it announced now and in this very way - fait accompli?

In early December, 2013, the public began to actively hold a protest in front of the National Assembly. Politicians from the opposition joined the rallies as well. The parliamentary majority of the leading Republican Party approved the agreement. The opposition did not participate in the vote.

During the same period another unpopular governmental decision became well-known causing even more outrage in the society. This time it was about a so-called mandatory funded pension system, which was again adopted by the National Assembly and came into force in January 2014. According to the new system all the citizens, born after 1974, must obligatorily transfer to the state treasury 5 to 10% of their salary, and thus save money for their future retirement. The government, in its turn, guarantees the return of these payments in a couple of decades. Several government agencies also joined the protests in the streets of Yerevan and in the social network.

People began to appeal on Facebook either not to pay for utilities up to the end (after all, this will be enough to cause damage to monopolists) or to pay by piecemeal. Another group of Facebook users made a call of disobedience against the new pension system. This movement was given the name “I Am Against”. More than 50 organizations and young activists appealed to Tigran Sargsyan, the RA Prime Minister, with a letter, emphasizing the risks of the bill that might cause even more emigration from the country.

And this time, when the Parliament adopted the law, the public, not only young people, by the way, protested in a rally. The most massive protest took place in Yerevan on January 18. The number of protesters exceeded 10 thousand people.

Citizen: “I hope that the Constitutional Court will not approve the law, because it violates our rights. Our family already has a bitter experience: my parents have been saving money for many years, but with the fall of the Soviet Union they lost all their savings at once. I am sure that the same thing is going to happen today. They have got a single task - to replenish the budget”.

Citizen: “I am against this obligation, because when my child gets a job, more than 10% of his salary will be taken away. Today I can buy two sacks of flour with that money, and that will be sufficient for my family for a month. Give me 100 sacks of flour, and tomorrow I will myself give you back 160 tons of flour”.

This social tension set up a debate between Robert Kocharyan, the second President, and Tigran Sargsyan, the current Prime Minister. In an interview with the press R. Kocharyan announced that the issue of the implementation of the new pension system had been discussed since his term in office, although he did not go for it, since the reform was too risky. “There is no guarantee that the government will be able to compensate the losses of RA citizens in the case of failure. You should not take seriously the argument on compensation from the budget,” Kocharyan said in the interview.

Citizen: “We are sure that we will win. We protect our rights. The law is obviously unconstitutional and inhumane, especially for our country”.

Citizen: “The fact that so many people have gathered there is already encouraging. We must achieve the desired results, our requirements must be fulfilled. We do not trust the government. I am an employer myself.”

Citizen: “We must fight, go out and create a state where it is possible to live in. The government deceives us every day. Let us at least take the fact of gas debt of 300 million. How can I be sure that in 30 years, while I am saving my pension, this debt would not be returned?”

“In fact, the mandatory funded pension system is no less dangerous than wars, the genocide, and prolonged drought,” Hrant Bagratyan, the former RA Prime Minister, wrote on his wall on Facebook. He drew the attention of the Constitutional Court members on several facts, indicating that there are no any countries in our times implementing such a system. And the countries that have implemented the system had to change the conditions soon after its introduction.

On January 24, the Constitutional Court of Armenia decided to suspend the law on pensions until the end of March, that is, until the completion of the trial. Hopefully, the court might leave out the “mandatory” component from the new pension system. Calls are being made to continue the struggle.

This material has been prepared within the framework of a project implemented by Region Research Center with the financial support of the Polish Embassy in Armenia. The views and opinions expressed in this material do not reflect the official policy or position of the Polish Government. 

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30 January, 2014
Right after the New Year, the citizens of Armenia were shocked by the gas and electricity bills for December.

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