Economists Say: The Result of the Retirement Age Increase Legislation Will Be Higher Inflation

Jamsheed Asadi, an economist, described the parliament's decision to raise the retirement age as a method of "creating money" and "terrible" in an interview with Voice of America on November 20. He stated that this action by the government and parliament "will severely increase inflation and break the backs of the people under expenses." Asadi added, "Thus, not only will retirees receive their pensions later, but they will also find it difficult to cope with the added costs due to inflation." According to this economist's assessment, the Islamic Republic is in a situation where, due to economic sanctions and oil exports, it faces an empty treasury and is not only unable to fulfill its obligations to retirees but is also forced to reduce costs and generate income wherever possible. Asadi, while acknowledging that taking interest in advanced industrial countries is common to compensate for budget deficits, stated that comparing the situation of the Islamic Republic with these countries is erroneous because "no one lends money to the Islamic Republic." He added, "Neither do sanctions allow anyone to lend money to this country, nor has it signed the FATF, which would enable lending to this country." For this reason, it must create money from somewhere while industrial countries are "strong and have credit to borrow, and the interest rates they have to pay back on these loans are not very high." This economist residing in France discussed the phenomenon of budget deficits in industrial countries and the difference with the situation in the Islamic Republic, saying, "Because there is democracy there, citizens, rightly or wrongly, always have more demands, which causes the government to borrow more to meet the people's requests." He further added that people in industrial countries have the right to vote, which makes the survival of governments dependent on the people's votes, but "where does an Iranian citizen have the right to vote?" On December 19, parliament approved a clause stating that "to reduce the imbalance of pension funds" and strengthen the funds' ability to fulfill their assigned duties, the employment years of insured individuals will be increased by two to five months for each additional year. The increase in the retirement age is another controversial issue of the seventh development plan, and it seems that the government's entry into the retirees' domain will have many repercussions and will intensify the wave of protests from this group in the coming months. In recent weeks, the parliament has been reviewing and approving various sections of the Islamic Republic's seventh development plan, which, after finalization, must serve as the basis for government planning and budgeting. Meanwhile, the six previous development plans of the Islamic Republic, which were approved for the "development" of Iran, have not achieved their goals, according to the admission of Islamic Republic officials, and almost none have been fully implemented.