A regular Cabinet meeting took place today, chaired by Prime Minister Nikol Pashinyan.

The Government defined the separate directions of the types of social expenses, the scope of family members and the maximum amount of compensation for social expenses. In particular, it is proposed to define that in the sense of the application of Article 141.1 of the Tax Code, for the purpose of compensation of social expenses, the family members of a natural person considered as a declarant are his spouse, parents and children (adoptors and adoptees). According to the decision, the costs of purchasing a health insurance package from the insurance companies operating in the Republic of Armenia are considered social expenses for health care. Tuition fees for pre-vocational, elementary, basic, secondary, pre-professional, secondary professional, higher vocational and post-secondary vocational educational programs implemented in Armenia are considered as social expenses for education. At the same time, it is recommended not to define a separate direction of social spending on housing security at the current stage, because the current tax legislation defines regulations for the refund of income tax for the purpose of purchasing an apartment or individual residential house or building an individual residential house.

The Government will allocate another amount of money for the purpose of improving the condition of the country's roads, in order to continue or start the works of 24 road sections and one transport facility planned by the 2023 major repair programs. The total length of the road to be overhauled by the decision is 47.3 km, for the implementation of which road construction works worth 18.9 billion AMD are planned.

The Government made changes to the state support (renovation) program for energy-efficient renovation of apartments and individual residential houses. As a result, the validity period of the program will be extended for one year, until July 1, 2024, as well as a new approach for subsidizing the interest of loans provided by the program is planned.

At today's Cabinet meeting, Nikol Pashinyan referred to the indicator of economic activity in Armenia. "The Republic of Armenia continues to be in the domain of high economic activity. The economic indicators of May 2023 have been published, and I must record that in May of this year compared to May of the previous year, an economic activity index of 13.7 percent was recorded. I want to remind that we already had very high, significant economic activity in May of last year, if I'm not mistaken it was 10.8. That is, we even have a certain acceleration of economic activity, including for the 5 months. I would also like to emphasize that compared to May last year, industry grew by 5.3 percent, construction by 18.4 percent, trade by 28.6 percent, and services by 12.3 percent. We have a very good fact. we have a certain, so to speak, drop in inflation, and in May the inflation rate was 1.3 percent," the Prime Minister said.

The Government approved the medium-term state expenditure program of the Republic of Armenia for 2024-2026. In line with the priorities of the Armenian Government’s Action Plan, a number of priority measures of social, educational, health and infrastructure nature will be implemented in the medium term.

The Government adopted a decision in order to create prerequisites for the implementation of the provision regarding the increase of pensions (increase of the average monthly and minimum pensions) provided by the Armenian Government’s Action Plan. The decision proposes to set the amount of the minimum pension at 36,000 AMD from July 1, 2023 (instead of 31,600 AMD), the amount of the basic pension for calculating the amount of labor at 24,000 AMD (instead of 21,000 AMD), the value of one year of military service for future pension at 1,750 AMD (instead of 1,600 AMD). Minister of Labor and Social Affairs Narek Mkrtchyan noted that the decision fulfills the promise given in the Action Plan of the Government to equalize the minimum and average pensions with the values of food and consumer baskets respectively.

According to the Minister, according to this logic, pension increase took place twice in 2022 and a new institution of cashback was introduced. "With the presented decisions, the average pension will increase by 7.1 percent, from 46,100 AMD to 49,700 AMD. The average military pension will reach 91,600 AMD from the current 87,590 AMD. With this increase, the goal set by the Government Action Plan to equalize the minimum pension with the food basket in 2026 will almost be achieved by July 1, 2023, because this ratio is 99.5 percent," said the Minister.