Vote for Women’s Early Retirement Sparks Heated Debate in Iran

EghtesadOnline: The bill approved by lawmakers making women eligible for receiving pension after 20 years of work, regardless of age, will impose expenses close to 50 trillion rials (approximately $1.3 billion) and 300 trillion rials ($7.78 billion) on the Civil Servants Pension Fund and Social Security Organization respectively, a deputy minister of cooperatives, labor and social welfare, Hojjatollah Mirzaei, said.

News ID: ۷۷۳۶۰۷

31 January 2017

The bill proposed by Parvaneh Salahshouri, an MP from Tehran Province, in the form of an annex to the sixth five-year development plan (2016-21), will modify Iran’s social security program under which retirement pension applies to men aged 60 or women aged 55 with at least 20 years of service; or men aged 50 and women aged 45 with at least 30 years of service; or men and women of any age with at least 35 years of service.

The add-on mandates all government institutions, organizations and bodies as well as non-government organizations to allow women to retire after 20 years of insurance premium contribution, with no age bar.

The bill needs final approval by the powerful oversight body, the Guardians Council, which reviews legislation to ensure compliance with Iran’s Islamic Republic Constitution and the Islamic law, before it is implemented, according to Financial Tribune.

Standpoint of Opponents

Mirzaei said that with the passage of the bill, one-third of the employed women will be qualified to leave their jobs, which would have social and mental repercussions for the society.

Economist Saeed Leylaz, another opponent of the scheme, believes that such bills will cause the caving in of political, economic and social structures.

“Populist approaches in Iran are not confined to reformists or conservatives. All governments pursue such projects. When the government debts amount to over $181.5 billion, pension funds are bankrupt and the banking network is faced with towering financial tribulations, such costly schemes are like playing the Russian roulette.”

Leylaz said when these people retire, they will not only stop paying insurance premiums to the social security funds, but will also be entitled to pensions.

They will, he added, enter the job market in different ways and as such, occupy positions that would otherwise be available to the younger and more competent people.

“As a result, no positive changes will occur in the job market and on top of that, the incomes of social security funds will decrease while their outlays will rise.”

Leylaz believes that when there is financial crisis, expense control policies must be prioritized over ones that increase revenues.

Yet, he says, over the past two weeks, the parliament has proposed numerous costly bills regardless of how the expenses are to be provided for.

“Therefore, I would say that the advocates of the bill are not well acquainted with where the country stands economically. On the one hand, women are encouraged to take up jobs and have economic participation, and on the other, legislation is passed to essentially keep them at home,” he said.

Advocates Sentiment

Head of the parliament’s women faction, Parvaneh Salahshouri, who proposed the scheme in the first place, says that in preparing the bill, they sought the view of Majlis Research Center and a number of economists to ensure the practicality of the bill.

“There are two groups opposing the bill. One group includes insurance companies and pension funds who benefit from the current regulation whereby civil servants can collect pension after 30 years of service,” she said.

“Yet, the difference in the amount of received pensions must be taken into account.”

When people retire after 20 years, they will receive 66% of the pension they would have collected if they were to retire after 30 years of service.

The second group, says the lawmaker, are ones who believe if executed, the bill would drive women out of the job market to make room for men.

“A lot of women have themselves requested this scheme. It is possible for employers to fire workforce without making them eligible for a pension and, of course, no women’s rights activist wants this to happen. If insurance companies manage their financial resources efficiently, the scheme will not cost the government much and women will benefit from it,” she said.

Hassan Norouzi, another lawmaker and advocate of the bill, says some women want to retire early and attend to their families and this does not mean they are made unemployed.

“If anyone wants to remain in their job for the whole 30 years, they are free to do that. Also, the objections made by insurance funds are pointless since they will be paying pensions equal to 20 days worth of work to these people. When someone wants to retire early, why shouldn’t their request be granted? This way more vacancies would become available for other job seekers.”