Iran’s Social Security Organization Navigates Temporary Liquidity Challenge, Pensions to be Paid After Brief Delay
In a detailed address to retirement councils across the nation, Mostafa Salari, the Managing Director of Iran’s Social Security Organization, provided a comprehensive overview of the organization’s financial landscape and the plan for ensuring pension payments.
A Temporary Liquidity Constraint
Mr. Salari explained that a brief delay of four to five days for July pension payments is anticipated due to current constraints within the national banking system’s resources. He emphasized that the organization is actively working to secure the necessary funds.
“The reality is that if we can secure even one Rial more in these next few days, it is a blessing,” Salari stated, highlighting the concerted efforts being made. “The level of risk and cost that banks can currently accept is at its limit just to enable us to process these salaries. The banks simply do not have capacity beyond this at the moment.”
A Proactive Financial Strategy
The address outlined the organization’s significant financial commitments, with projected expenses of 1,500 trillion Tomans for the upcoming year. A substantial portion, 1,200 trillion Tomans, is expected to be covered by insurance premiums. The remaining 300 trillion Tomans will be sourced through other channels, including returns from affiliated companies and government support, demonstrating a multi-faceted approach to financial stability.
Salari contextualized the current situation, pointing to a 32% shortfall in resources last month. He attributed part of this to the recent 12-day conflict, which caused delays in the collection of premiums for the months of Khordad and Tir (June/July). This unforeseen event placed considerable pressure on the system.
Government Cooperation and Legislative Support
In response to these challenges, the organization is receiving unprecedented cooperation from the government. Salari confirmed that the government has accepted to settle debts beyond the 185 trillion Tomans stipulated in the budget law. Furthermore, upon the order of the President, the heads of the three branches of government have convened to amend relevant legislation, facilitating the structured, annual settlement of this significant obligation.
“This is the first time we are reaching out to the government regarding debt settlement and receiving a positive response,” Salari noted, underscoring the collaborative effort to resolve the issue.
Payment Schedule and Future Commitments
A clear timeline for settling all outstanding payments was provided. The organization will prioritize clearing the arrears for minimum-wage pensioners, who constitute 70% of the fund’s beneficiaries, immediately. The remaining pension arrears are scheduled for payment in the first half of the month of Shahrivar (late August/early September). Additionally, claims for supplemental insurance will be processed starting in Shahrivar.
Salari concluded by reaffirming the organization’s primary duty: “Interest-free loans and charitable schemes are a small part of our commitments, but free healthcare and pensions are our main mission.” The briefing underscored a transparent and proactive management strategy aimed at navigating temporary liquidity challenges while fulfilling all obligations to pensioners.
