Finance Minister Vahe Hovannisian said on November 11 that the government has no additional funds in its proposed 2027 budget to raise pensions.

“There are no additional funds for increasing pensions. All resources have been calculated within the deficit and revenue patterns that we have planned for 2027,” the minister told reporters in parliament.

His remarks came two days after Minister of Labor and Welfare Arsen Torosian announced that the government had dropped plans to abolish state funeral allowances for most families.

Torosian said the existing rules would remain in force and the draft legislation put up for public discussion would not be submitted to parliament.

The Ministry of Labor and Welfare told RFE/RL’s Armenian Service that the proposed changes to funeral benefits and the 1,000-dram minimum pension increase were part of the same legislative package. Consequently, scrapping the reform meant the pension raise would also be canceled, the ministry said.

Hovannisian noted the connection on Wednesday but did not elaborate.

The original proposal, announced by Prime Minister Nikol Pashinian in September, would have restricted the one-time 200,000-dram ($550) funeral allowance to socially vulnerable families starting in January 2027 while raising the minimum pension by 1,000 drams.

The plan drew strong backlash from opposition groups and the public, with many citizens expressing disapproval in interviews with RFE/RL’s Armenian Service.

The decision to withdraw the funeral benefits reform package and consequently not to raise pensions comes as top government officials and lawmakers prepare to receive substantial pay raises criticized by the opposition.

Under a recent government decision, Prime Minister Pashinian’s monthly salary will increase by nearly 70 percent and President Vahagn Khachaturian’s by over 60 percent, with both reaching 2.6 million drams ($7,200).

Hovannisian and other cabinet ministers will see their salaries double to 2 million drams ($5,500). Beginning in January, the parliamentary speaker will receive 2.5 million drams ($6,900) and lawmakers will make 1.5 million drams ($4,100) a month – an increase of 70 to 80 percent.

Pashinian has defended the salary increases for senior officials, framing the move as a major component of the government’s anti-corruption reforms.

The government last raised pensions on April 1, 2026, by 10,000 drams ($27.5), two months before parliamentary elections in what opposition figures called an election gimmick – an allegation the ruling party denied.

Armenia’s current minimum monthly pension is 46,000 drams ($127).