Turkmen Pension Shock

Pensioners in Turkmenistan are reeling in shock at the latest arbitrary measure imposed by their government which will mean some have their pensions slashed by a third, while the poorest lose all their benefits.



News of the changes was not published in the tightly-controlled national press – where the talk is still of the “Golden Age” which President Saparmurat Niazov, better known as Turkmenbashi, has created for his subjects. Instead, elderly people across the country were summoned to meetings at their district government headquarters where they were told of the cuts.



Those who were receiving the minimum monthly pension worth about 20 US dollars a month were told they would lose it altogether, while higher rates of 40 to 50 dollars are to be cut by an average of 30 per cent. Anyone who has not worked for 20 years in succession prior to 1998 also loses all pension rights.



“The meeting I went to was attended by about 300 people,” said one woman. “When they told us the news there was uproar, everyone was angry and started asking what the basis for the decision was. There hadn’t been a decree or any regulatory documentation.



“They asked us not to get cross but to take it in the right way. They explained that it was a verbal instruction that had come from the social security authorities.”



According to this pensioner, officials cited Turkmenbashi’s oft-repeated phrases about family values, “They recalled our president’s words that our children should to feed us; it’s their filial duty. But many of us don’t have children or else they’ve gone off to Russia, and we just live on our pensions.”



Eyewitnesses said the announcement caused scenes of uproar at the public meetings. In the capital Ashgabat, people collapsed in shock, and some had heart attacks. Five ambulances were called to one meeting alone. A doctor who was on call at the time said, “In the days when the rumour started going round that pensioners were to lose their benefits, 90 per cent of call-outs were to attend people of pension age…many had to be hospitalised. One old woman asked to stay in hospital as she had nothing to live on at home.”



Olga Petrovna, a pensioner who says her neighbour died of a heart attack at hearing the news commented, “By cutting pensions they’re cutting the number of pensioners, too.”



In the western port now called Turkmenbashi, a crowd of pensioners came out into the central city square in an unprecedented show of protest in this heavily policed state where demonstrations are unknown.



Rural people are even worse hit than city-dwellers. People who used to work on Soviet-era collective farms were already getting less than 10 dollars a month – half the official minimum – and now they will lose that too. An official reportedly said, “the collective farm people work the land – let the land feed them.”



One man from Ashgabat said a woman in the village where his relatives live committed suicide by setting herself on fire. “She wrote [a note] saying she didn’t want to be a burden on her children,” he said. “Society should be ashamed of itself.”



Others say they were initially misled before being told the full extent of the changes. “I get the minimum pension of 490,000 manats [about 20 dollars]. On the tenth of every month I go to the social security office to get it, but when I went in January they asked me to come back the next week because the money hadn’t arrived in the bank yet. A week later they told me I wouldn’t be getting anything from the state any more, and when I asked the reason they replied they’d had instructions from above.”



This woman said she had worked for 35 years before retiring. “No one cares… about what I’m to live on in my final years– I’m desperate.”



In 1998, Turkmenistan introduced a contributions scheme under which people have to pay into a pension fund themselves rather than receiving the state pension. There are about 400,000 people officially listed as pensioners in Turkmenistan, a country of five million where the retirement age is currently 62 for men and 57 for women.



Since the reduction in payments has not been officially announced, it is hard to assess why the government has been driven to take such a step. Claimed economic growth of 20 or more per cent a year should be read with scepticism, but the country should have hard currency earnings from its gas and cotton exports. Yet the national budget appears desperately squeezed for cash.



Some local observers say that although recently-signed gas contracts with Russia and Ukraine should be lucrative in the long term, there is an urgent need to increase gas pipeline capacity, which means savings have to be found now to fund the investment.



A civil servant working for the social security ministry said, “There’s been a budget deficit for several years now, but for the second year in a row the bureaucrats are trying to fill the gaps at the pensioners’ expense. [In 2005] the pension age was raised from 55 to 57 for women and from 60 to 62 for men.



“But I regard what the authorities have now done as an act of sacrilege towards the elderly.”



(Names of interviewees have been changed or withheld out of concern for their safety.)