With the "On indexation of labor pensions" Decree signed by President Ilham Aliyev, all types of labor pensions were indexed and increased from the beginning of this year. The increases, covering 1 million 100 thousand citizens, were adjusted to the percentage increase in the average monthly salary in the previous year.
So, how much will the pensions of working citizens be increased this year?
Modern.az reports that economist-deputy Vugar Bayramov commented on this issue:
According to the deputy, based on the current legislation, the pension of pensioners who continue to work after being assigned a labor pension for age is recalculated after 6 years according to the subsequently accumulated capital and added to the pension.
"After 6 years, pension capital is recorded in the insurance part of the citizen's individual account, taking into account 90 percent of the mandatory state social insurance contributions paid. For a new increase in pension, the pension amount is recalculated by dividing the pension capital accumulated during the period of work by 72 (144 - 72 (number of months worked after the date of pension assignment).
In addition, a double increase in the pensions of our working citizens is possible this year. The pension received by that person is indexed and increased by 9.3 percent according to existing rules. Then, if his 6-year work period is completed, it is added to his pension.
For example, our citizen was assigned a labor pension on general grounds for age on May 1, 2020, and the person continued to work. At the end of 2025, the pension amount of that citizen was 800 manats. His pension amount is recalculated on May 1, 2026, because he worked for 6 years after the pension was assigned. During this period, 25200 manats (taking into account 90 percent of the mandatory state social insurance contributions paid) of pension capital were recorded in the insurance part of the person's individual account. In this case, the pension amount is recalculated by dividing the pension capital accumulated by the person during that period (25200 manats) by 72. This means that 350 manats are added to that person's pension. But since that citizen receives a labor pension, his pension was indexed from January 1. In May of this year, that person's new pension amount is as follows: 800 manats + 74.4 manats (800 manats X 9.3%) + 350 manats = 1224.4 manats.
As can be seen, if our pensioners who continue their labor activity continue to work and the 6-year work period is completed this year, they can benefit from both the indexation increase and the recalculation increase," the deputy said.
