In 2020, changes were made to a number of benefits with the aim of improving the demographic situation in the country. Basically, the government aims to create a setting where having children will not be deemed as a risk for the wellbeing of the family. According to the experts, this is a needed but not sufficient measure to increase the birthrate in the country. Jointly with this, there is a need to continue the implementation of programs directed at the provision of opportunities to balance both family and professional responsibilities and the elimination of factors hindering the entry of young mothers into the labor market.
Drawing special attention to women in rural areas
Starting from July 1 of this year, the one-time benefit paid for the birth of the first and second child will become 300 thousand Armenian drams. Currently, this amount is at 50 thousand AMD for the first child and 150 thousand AMD for the second one. The amount of the benefit for the third and every child after that will remain at respectively 1 ml and 1.5 ml AMD.
Maternity benefits for childcare will also increase. From July 1, 2020, mothers who are on maternity leave will receive a monthly benefit of 26,500 AMD (18,000 AMD previously) for a child of up to 2 years of age. An important thing to note is that these changes will take effect not only for new beneficiaries but also already active ones.
As Armenian Prime Minister Nikol Pashinyan has noted, through increasing these benefits the government is aiming to encourage mothers in the labor market or with relevant skills to get back to work as soon as possible. “I want to emphasize that this is one of the reflections of our philosophy about expanding women’s involvement in public and economic life.”
The most exciting change has to do with women in rural areas – both employed and unemployed; for the first time ever, the state will be looking after unemployed women in rural areas, who, starting from July 1, will receive a monthly benefit of 26,500 AMD until their child reaches the age of 2. Whereas, mothers on maternity leave in rural areas will receive double the amount of this monthly benefit (53,000 AMD) until their child reaches the age of 2. Such targeting of women in rural areas is not random. The problem is that the birthrate in Armenia has declined in recent years particularly in rural regions, while, according to international statistics, birthrates in rural areas are usually higher than in urban areas. The increase in these benefits seeks to prevent the current dangerous trend.
In addition, as the prime minister has noted, through doubling the amount of the benefit for working mothers in rural areas, employment opportunities are created also for others. “If a woman receives double the amount of this benefit because she is working, generally speaking, she might have to hire a babysitter. I mean in this way she not only keeps her job but also creates another one for some other woman. This is our philosophy: we have to insert a development component in every social program,” he noted.
Tuition fee reimbursement for students with children
A new program was unveiled recently: the ministry of education, science, culture and sports has put up a new draft law for public discussion stipulating a full reimbursement of the tuition fee in form of social benefits for students enrolled in Bachelor degree programs of Armenian universities who have two or more minor children. The opportunity will also extend to students who undergo military training during the course of their studies in collaboration with the ministry of defense and have concluded civil and legal contracts to serve in the military at the designated location with designated conditions upon graduation from the university.
3 new mortgage programs launch on July 1
Home loan programs for young families are also part of the family-based policy. In 2020, three new programs will be implemented in Armenia looking to secure homes for young families and families with children in their care.
Iravaban.net reports that, according to Smbat Saiyan, First Deputy Minister of Labor and Social Affairs, the first of these three programs will be a one-time financial assistance for acquiring apartments in the regions; if there are 2 minors in the family, the state will provide the down payment for the family to receive a home loan. However, the amount cannot exceed 5% of the apartment’s overall value, but may increase by an additional 2 million AMD based on the number of children in the family.
The other program has to do with the down payments of families with children as well as young families. The main obstacle for buying an apartment through credit for young families is the lack of a down payment. The government has therefore decided to provide insurance for this down payment. The beneficiary will pay for this down payment without any additional interests or other payments because the government will insure the amount of the down payment for the given period, which means that the beneficiary will have effectively made the down payment. However, in all such cases a 5% contribution by the applicant will be mandatory.
The third program is for families that already do have mortgages, are making regular payments and then have another child, which maybe seen as a financial risk, especially when the mother is employed. This means not only additional expenses, but also additional loss of income. Taking this into account, the government has decided to provide assistance to families that have mortgages and then a new baby comes along. The assistance will be a certain percentage of the mortgage in the form of a lump sum. I.e., if the family has their first or second child, financial assistance equal to the amount of the 10% in the provinces and 5% in Yerevan will be provided, while for the third and more children, these figures will increase by respectively 50% and 25%. Certain bonuses will also be awarded to families whose age will be below a certain threshold.
Increasing social benefits alone will not resolve all problems
In an interview with WomenNet.am, Anna Hovhannisyan, UNFPA Population and Development Project Coordinator, noted that the UN Fund highly values recent actions taken by the Armenian government directed at the improvement of the country’s demographic situation.
“All these programs will become effective on July 1 and will surely have a positive impact on the demographic picture in Armenia. However, international experience shows us that there is no specific remedy that can tackle this or that demographic challenge. The government’s programs are aimed at increasing the birthrate in the country, which is rather low, and they will definitely leave their positive mark in this respect, but I want to repeat once again that no single program can bring forth a complete solution for this issue,” Saiyan noted.
According to him, there are many countries in the world that have the same experience in relation to demographic crisis situations, and it is clear that the issue requires a systemic approach through complex solutions. In other words, increasing the lump sum paid for the birth of a child is not enough to expect a positive solution to the issue.
“We should first address the causes of the issue. The low birthrate in Armenia has to do with social and economic conditions. Let’s not forget that the social benefits that are going to increase from July 1 by 40% are going to be given only to employed women on maternity leave. However, we should not leave out women who are not involved in the labor market; it is important to create equal conditions for them as well,” said Anna Hovhannisyan. At the same time, she pointed out the fact that the most significant feature of this program is that the state finally paid attention to women residing in rural areas. It is not a big secret to anyone that only a small share of women work in rural areas and are legally registered employees thus being able to use social benefits.
“Thanks to these programs, both employed and unemployed women in rural areas will receive social benefits. Furthermore, an employed woman residing in a rural area will receive double the amount of the benefit. This is a very welcoming change as Armenia differs a lot from many other countries in the sense that all across the world birthrates are much higher in rural areas, whereas in Armenia we have the opposite scenario. This means that a different approach should be adopted in dealing with rural areas, and the government recognized this need and took this unprecedented step,” she highlighted.
Anna Hovhannisyan also noted that the government should create conditions for families to be able to juggle between the upbringing of the child and their work so that having another child does not become a financial burden or pressure on them. In other words, a family should be able to calmly and without and complexities plan the birth of another child.
“Armenia had a strategy for demographics since 2009, however, no serious steps were being taken until now to implement that strategy. This is a special moment when the government not only recognizes the prevalence and significance of the issue, but also take concrete action and allocates spending for its implementation. I am confident that such programs will further enhance and new ones will come into play. The beginning has been very promising,” the UNFPA representative noted.
According to the statistical information presented by the Minister of Health, there was a slight decline in the birthrate of the country in 2019. While in 2018, there were 1,000 fewer births than in 2017, 2019 saw 700 fewer births than in 2018. “If the trend continues, we will first hit level zero: the number of births will equal the number of births from the previous year, and then there will be growth,” Minister Arsen Torosyan had announced.
In the meantime, the National Statistical Committee of Armenia announced that as of January 1 2019, Armenia’s permanent population was 2,965,300, which is the lowest such figure since 1990.
