Stages of automating pension determination in Azerbaijan

Abstract

Pension is the restoration of a portion or the entire amount of a person’s lost salary. When a person loses their official job, a pension is provided as compensation for the lost job and salary. A pension is essentially an insurance product. Just as we insure our cars, homes, and lives, a pension serves as insurance for the job or salary we might lose. Therefore, it should be viewed purely as an economic mechanism. In this system, the State Social Protection Fund acts as the insurer. It collects annual insurance premiums and, in the event of an insurance occurrence, pays out benefits to individuals who have reached retirement age. The disbursement of social insurance payments, or pensions, begins with the determination of the pension amount. Today, in our country, the process of determining pension amounts is automated. The automation of this process has primarily eliminated subjective influences in the calculation and awarding of pensions. It must be understood that despite stringent control mechanisms, subjective influences cannot be completely eradicated where human factors are involved. Previously, there were instances of exploitation of citizens' lack of information during pension determination. The automated pension determination system has first and foremost removed direct citizen-official contact and ensured transparency. Additionally, it has achieved operational efficiency in the determination process, meaning that when a citizen reaches retirement age, they can realize their pension rights without going anywhere, applying, presenting documents, or facing any delays or bureaucratic hurdles. In this regard, the new system serves the interests of citizens.