"If we calculate the median pension in Azerbaijan, it turns out that in the CIS …

On April 4, the Ministry of Labor and Social Protection of the Population reported that in international dollar terms, the average monthly pension of Azerbaijan rose from 2nd to 1st place in the comparative ranking for the CIS, Georgia, and Ukraine. The Ministry of Labor described this as "the result of the dynamics of pension growth as a result of social reforms": "At the same time, our country continues to rank the first in  the rating in dollar terms, calculated on the basis of purchasing power parity (PPP) indicators of minimum and average monthly pensions."

According to the table provided by the Ministry, the minimum pension in Azerbaijan is $165, and the average is $249. And in terms of purchasing power, this amount is $ 424 and $ 663, respectively.

A member of the Milli Majlis Committee on economic policy, Industry and Entrepreneurship, Aydin Huseynov, in his comment to Turan, said if the ministry distributed this indicator, it refers to official statistics: "Besides, we have a high purchasing power in the CIS compared to other countries."

The MP added that the Azerbaijani state pursues a socially oriented policy: "With the increase in our budget, pensions and salaries increase. I think that this year we will witness a new social package. As our budget grows, we are witnessing, in particular, the decrees of Mr. President on increasing pensions and scholarships, social benefits, wages."

Economist Gubad Ibadoglu told Radio Azadlig that purchasing power refers to how many goods and services a pensioner can afford: "Currently, the minimum pension in Azerbaijan is $165, and he cannot live in Europe with such a pension. But in Azerbaijan, for these 165 dollars, you can buy certain products, albeit at a minimum level. From this point of view, if we compare the purchasing power of pensions in Azerbaijan with the purchasing power in Europe, then this indicator is high in Azerbaijan. Because the prices of products and services in Azerbaijan are lower than in Europe."

He believes that this approach of the Ministry is wrong because the World Bank calculates gross domestic product (GDP) on the basis of PPP: "This allows us to compare the real volume of GDP. GDP is formed from all types of commodity services, both consumption and production. But what does a pensioner have to do with production? Among the expenses of our pensioner are only consumer goods. These are basic foodstuffs and utilities."

According to Ibadoglu, the most correct way for pensioners is to calculate the median pension along with the minimum and average pension: "Because the pension of a small group of pensioners in Azerbaijan is very high. However, the pension of most pensioners is close to the minimum. Therefore, the average pension in Azerbaijan turns out to be high. The median pension means that half of pensioners receive a pension below this amount, and half-above. And this amount should be calculated by the Ministry of Labor and Social Protection of the Population. Then we will be able to see more accurate figures."

According to the economist, if the median pension in Azerbaijan is calculated and converted into dollars, it will become clear that Azerbaijan is in the lowest positions in the CIS: "I also propose to the Ministry of Labor and Social Protection of the Population to calculate the minimum cost of pensions based on real prices. In general, a separate inflation basket should be created for pensioners."