Baku Slashes Benefits

The old state habit of doling out freebies to large swathes of the population is about to be swept away, like so many other relics of the communist past.

Up to a fifth of Azerbaijan's population is going to be affected by hard-hitting public spending reforms, as Baku slashes social handouts from around 200 to 30 million US dollars a year. The legislation, which comes into effect in the coming weeks, follows on the heels of World Bank guidelines for the delivery of future credits.

There is concern that when the cuts actually start, biting public discontent will quickly turn to violence, as already impoverished Azeris face yet more hardship. War veterans who recently came out in protest against the move fear for their health, even lives, as winter arrives and fuel subsidies are axed.

Those currently receiving state aid also include pensioners, the disabled, orphans, refugees, internally displaced persons and the unemployed who currently make up around 25 per cent of the labour force.

Although the reforms have been announced on state television, they have been relayed in such an ambiguous way that they are still bound to come as a complete surprise to many.

The government is doubtless hoping that there will be no repeat of the hunger strikes back in February by veterans protesting their meagre pensions. Their stand was violently broken up and the consequent imprisonment of invalided ex-soldiers (for public disorder offences) embarrassed President Heidar Aliev's administration.

There has been scant reform in the social security sector since the days of the Soviet Union, but the World Bank which has so far extended around 462 million dollars to Azerbaijan since 1992, is insisting that future projects will only receive funding if certain economic criteria are met.

Around two-thirds of around million and a half Azeris currently receiving state handouts will be denied free rent, utilities, public transport and other benefits. The poorest (except pensioners) will get just a third of their current benefits, leaving them to struggle on a sixth of the average wage.

Karabakh War Veterans Union chairman, Altay Mamedov, says the benefits legislation will have a crippling effect on all those forced to rely on state stipends. He wants the government to rescind its new law.

The Minister for Labour and Social Security, Ali Nagiyev, says the legislation will stamp out abuses and redirect funds to the really needy. Pensioners, he says, can look forward to an increase of at least ten per cent in their allowances, ensuring that they receive something approaching the basic monthly salary of 47 dollars.

Yet despite these assurances, it is clear that the era of free services has come to an end in Azerbaijan. Nothing for free any more, not even - as the Russian proverb goes - the cheese in a mousetrap.

Kimal Ali is a journalist with the Baku-based daily Zerkalo