Azerbaijan is discussing whether heirs should be allowed to receive part of a deceased person’s pension capital, with one proposal suggesting a payment of 30% of the accumulated funds.
No decision has been adopted, and citizens do not currently have a new right to such a payment.
The issue was raised at a meeting of the Milli Majlis Committee on Labor and Social Policy. Lawmaker Vugar Bayramov told BAKU.WS that the proposal is being studied and would require financial calculations and a mechanism for implementation.
What Happens to Pension Capital After Death
Economist Rashad Hasanov, speaking in a television report on the issue, drew attention to the absence in the current system of the type of pension-capital inheritance mechanism now under discussion.
A person may build pension rights for years through social insurance contributions but die before using those rights in full. Hasanov said the possibility of transferring such capital to heirs should be considered.
He noted that international practice includes different models, including transferring relevant funds to the pension accounts of family members.
His assessment and the parliamentary discussion must be distinguished from the law as it currently stands. Neither the economist’s proposal nor lawmakers’ consideration of it creates a legal basis for receiving the money.
Budget Impact Still Has to Be Calculated
Bayramov said the possible burden on the state budget and the financial sustainability of the State Social Protection Fund must be assessed before any change is made.
Hasanov also linked the development of inheritance mechanisms to the possible future creation of private pension funds. Under such a system, rules for inheritance, investment and distribution among family members could be established by legislation and by contracts with the funds.
That is a separate area of possible reform, not confirmation that 30% of pension capital can be paid under the existing system.
No effective date or final conditions have been established. The proposal remains under financial and legislative review.
Source: Vesti Baku.