BAKU, Azerbaijan, December 9. The Azerbaijani
Parliament has approved the draft law "On the 2026 budget of the
State Social Protection Fund" in its third reading, Trend reports.
The document was presented for debate at today’s plenary
session.
The remaining free funds in the accounts of the State Social
Protection Fund (SSPF), including the apparatus of the body
(institution) and other structural units determined by the relevant
executive body, will be directed to financing the expenses of the
next year and/or to investment by the body (institution) determined
by the relevant executive body in accordance with the law "On
social insurance."
If the funds for mandatory state social insurance contributions
intended for organizations financed from the state budget during
the budget year are not fully received by the state social
protection fund, the amount of funds allocated from the state
budget to finance the obligations of the state budget in order to
balance the budget of the state social protection fund will be
increased by the difference between the intended and actually
calculated mandatory state social insurance contributions, and if
they are received in excess, it will be reduced by the difference
between the intended and actually calculated mandatory state social
insurance contributions.
SSPF's expenditure financing
source
The fund's total revenues are projected at 8.3 billion manat
($4.9 billion) next year, which is 705.7 million manat ($416
million) or 9.26% higher than the forecast revenues for 2025.
As many as 79.19% of the SSPF’s 2026 revenues, or 6.6 billion
manat ($3.89 billion), are expected to come from mandatory state
social insurance contributions, which is 593.7 million manat ($350
million), or 9.9%, higher than the corresponding figure for this
year.
In 2026, projected contributions to mandatory state social
insurance are 2.1 billion manat ($1.2 billion), or 32%, from
budget-funded organizations, and 4.482 billion manat ($2.6
billion), or 68%, from the non-budget sector. These amounts are 73
million manat, or $42 million (3.6%), and 520 million manat, or
$300 million (13.1%), higher compared to the approved 2025
forecast, respectively.
Contributions from individual entrepreneurs (excluding payments
for employees, covering only the entrepreneurs themselves) are
projected at 103.5 million manat ($60 million) in 2026, based on a
minimum wage of 400 manat ($230). The average monthly wage used for
calculating social insurance contributions is projected at 1,101
manat ($635) for 2025 and 1,170 manat ($675) for 2026.
Although total state obligations in 2026 amount to 3.6 billion
manat ($2.1 billion), 1.7 billion manat ($980 million) is planned
to be allocated from the state budget to balance the State Social
Protection Fund, representing 47.04% of total obligations, which is
100 million manat, or $58 million (6.25%), more than the approved
2025 forecast.
Revenue from calculated interest, financial sanctions, etc., is
expected to reach 32 million manat ($18 million) in 2026, two
million manat, or $1 million, (6.67%) higher than the previous
year’s expected figures.
SSPF expenditures
Expenditures of SSPF are projected to equal 8.48 billion manat
($5 billion) in 2026, which is 807 million manat, or $466 million
(10.51%), higher than the approved 2025 forecast.
Next year, payments to the population are projected at 8.2
billion manat ($4.7 billion), accounting for 96.62% of the fund’s
total expenditures.
In 2026, 7.99 billion manat ($4.6 billion) of projected social
payments will go to labor pensions, and 204 million manat ($117
million) to benefits financed through mandatory state social
insurance contributions. This total projection is 788 million manat
($452 million), or 10.63% higher than the approved 2025 forecast.
Pension payments will account for 97.52% of total social
payments.
The projected expenditure for labor pensions in 2026 (7.99
billion manat, or $4.6 billion) is 782 million manat ($449
million), or 10.85%, higher than the approved 2025 forecast. This
projection assumes that the monthly pension total at the end of
2025 will be 602 million manat ($345 million).
Assuming a 9.2% nominal wage growth in 2025, the expected annual
financial burden of pension indexation in 2026 is approximately 636
million manat ($365 million). A 1% variation in wage growth would
affect annual pension expenditures by roughly 72 million manat ($41
million).
The forecast for benefits financed through mandatory state
social insurance contributions in 2026 is 204 million manat ($117
million), exceeding the approved 2025 forecast by five million
manat ($3 million) or 2.6%.
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