BAKU, Azerbaijan, November 20. The draft law “On the Budget of the State Social Protection Fund for 2026” has been adopted in the first reading in the Azerbaijani Parliament, Trend reports.
Meanwhile, the document was submitted for discussion at today's plenary session of the parliament.
In addition, free funds remaining in the accounts of the State Social Protection Fund (including the apparatus and other structural units of the relevant body determined by the executive authority), in accordance with the law “On Social Insurance,” will be used to finance next year's expenses and/or invested by the relevant state body. If, during the budget year, the mandatory state social insurance contributions intended for organizations financed from the state budget are not received in full by the State Social Protection Fund, then to balance the budget of the State Social Protection Fund, the amount of funds allocated from the state budget for the fulfillment of state obligations will be increased by the difference between the stipulated and actually accrued mandatory state social insurance contributions. If the revenues exceed the planned amount, the specified amount will be reduced by the difference between the planned and actual mandatory contributions.
The total revenue of the fund's budget for 2026 is projected at 8.3 million manat ($4.9 million), which is 705.7 million manat, or $414.77 million (9.26 percent) more than the approved forecast for 2025.
Revenues from mandatory state social insurance contributions are projected at 6.5 million manat ($3.8 million), or 79.19 percent of the fund's total revenues, which is 593.7 million manat, or $349.3 million (9.9 percent) more than the approved forecast for 2025.
Of the total amount of projected insurance contributions for 2026, 2.1 million manat, or $1.24 million (32 percent), will be contributions from organizations financed from the budget, and 4.4 million manat, or $2.6 million (68 percent) will be contributions from the non-budgetary sector. This is 73.36 million manat, or $43 (3.6 percent), and 520.34 million manat, or $306 million (13.13 percent) more than the approved figures for 2025, respectively.
Revenues from mandatory social contributions from individual entrepreneurs (excluding contributions for employees, but only for themselves) with a minimum wage of 400 manat ($235) are projected at 103.5 million manat ($60.8 million). The average monthly wage, one of the main macroeconomic indicators used to determine the forecast indicators for compulsory state social insurance contributions, according to the Ministry of Economy, is indicated at 1,101 manat ($647) for 2025 and 1,170 manat ($688) for 2026.
Although the total amount of government obligations in 2026 is 3.6 billion manat ($2 billion), the amount of funds allocated from the state budget to finance state budget obligations to balance the budget of the State Social Protection Fund in 2026 is expected to be 1.7 billion manat ($1 billion). This amount, which is 47.04 percent of the total amount of state obligations, is 100 million manat ($59 million) or 6.25 percent more than the approved forecast for 2025.
Revenues from accrued interest, financial penalties, etc., are projected at 32 million manat ($19 million), which is two million manat, or $1.2 million (6.67 percent) higher than the previous year's expected figure.
The fund's expenditures for 2026 are projected at 8.4 million manat ($4.9 million), which is 806.65 million manat, or $474 million (10.51 percent) more than the approved forecast for 2025.
Payments to the population next year are projected at 8.1 million manat ($4.8 million), which is 96.62 percent of the fund's total expenditures.
Of the projected number of payments to the population next year, 7.9 million manat ($4.6 million) will be allocated to the payment of labor pensions, and 203.57 million manat ($120 million) to the payment of benefits provided at the expense of compulsory state social insurance contributions. The forecast for payments to the population in 2026 is 787.51 million manat ($463 million), which is 10.63 percent more than the approved forecast for 2025. Expenditures for the payment of labor pensions in 2026 account for 97.52 percent of payments to the population.
The projected expenditure on labor pensions in 2026 (7.9 million manat or $4.6 million) is expected to be 10.85 percent, which is 782.35 million manat ($459.5 million) more than the approved projection for 2025.
According to official data from the Ministry of Economy, taking into account the growth rate of nominal wages in 2025 at 9.2 percent, the annual financial burden associated with the indexation of labor pensions in 2026 is expected to be around 635.59 million manat ($374 million). In the event of a change in the nominal wage indicator, there may be changes in the projected indicators of pension expenditures and certain types of benefits paid from compulsory state social insurance contributions. Thus, the impact of an additional one percent change in the growth rate on annual pension expenditures alone is expected to be approximately 72 million manat ($42 million).
The forecast for benefit payments from compulsory state social insurance contributions in 2026 is estimated at 203.57 million manat ($120 million), which exceeds the approved forecast for 2025 by 2.6 percent or 5.16 million manat ($3 million).