Business The Government opens with a 0.9% increase in pensions

The Government opens with a 0.9% increase in pensions


Once the ministerial portfolios, the Government is launched with measures already announced as the pension increase for this year depending on the CPI. The new Minister council It will give the green light to a general revaluation of 0.9% of the 9.8 million Social Security benefits. In all likelihood, the decision is taken today, although it remains in the hands of the President of the Government, Pedro Sanchez, which is finally postponed until Friday, as originally planned. In the councils of ministers this week, which will mark the lines of action for the legislature of the newly formed Executive, from the social agents are expected gestures related to labor regulations such as the deletion of the article of status of workers which allows objective dismissal due to accumulation of medical leave.

In his inauguration yesterday, the head of the brand Ministry of Inclusion, Social Security and Migrations, José Luis Escrivá, stressed the commitment of the Government to the update of public pensions, taking as reference the evolution of prices. The former president of the Independent Authority for Fiscal Responsibility (Airef) also stated that propose "close quickly and effectively form the current Social Security deficit." In recent years, the gap between contribution income and expenses for the payment of pensions has been around 20,000 million euros.


The new Minister of Social Security promises to address private pensions

In his first speech as a minister, Escrivá also defended that the first step is to wipe the deficit in order to "dedicate everyone's efforts to finding fair and equitable solutions to the real challenge of Social Security, which is demographic aging." He also explained that in his “transversal and integrated vision of all the elements of the pension system”, they will include a “reflection” on private pensions. With insistence, he also opted for the solvency of the system and proposed "to give certainty to pensioners and workers both short and medium and long term."

To underpin the public pension system, the former president of the Fiscal Authority assured that the works of the Toledo Pact “are a good starting point, while claiming the need to reach consensus with the political forces and social agents to reach a reform “balanced, credible and economically and socially sustainable”.

Minister of Labor

Yolanda Díaz says in the inauguration that she will repeal the labor reform

The new Ministry of Social Security assumes the competencies of the passive class system (a pension scheme in extinction of officials that represents 14,000 million euros and currently has about 600,000 contributors and about 600,000 beneficiaries).

Yesterday, the outgoing Minister of Labor, Social Security and Migration, Magdalena Valerio, also ceded part of her duties to the head of Podemos Yolanda Díaz. In his first words at the head of the Work portfolio and before an auditorium in which both the maximum representatives of CC.OO. and UGT, Unai Sordo and Josep Maria Álvarez, as of the employers' CEOE and Cepyme, Antonio Garamendi and Gerardo Cuerva, Díaz defended that he will undertake the repeal of the labor reform. Business organizations have not hidden their concern about possible changes in labor regulations, changes that in their opinion jeopardize job creation and economic growth.

2020 increase

Social agents expect to meet this week to discuss the minimum wage

The repeal of the reform of Mariano Rajoy –supported de facto–, which condemned for years to an increase in benefits of 0.25%, is included in the program agreed between PSOE and Unidos Podemos. In addition to the return by law to the CPI, the text indicates that minimum and non-contributory pensions will gain purchasing power – in 2019, these lower pensions increased by 3%, compared to the 1.6% rise for the rest – . With the 0.9% increase, a pensioner who charges 1,000 euros will receive nine euros more per month. Social Security sources point out that, approved today Tuesday or Friday, it is very difficult for the increase in the payroll to be paid to pensioners at the end of the month.

At the end of the year, the then-acting Executive of Sanchez was inclined to postpone the update of public pensions until there was a fully functioning Government. The same happened with the 2% rise in salaries of public employees, in compliance with the agreement signed at the time by the Minister of Finance, Christopher Montoro, and the main trade union organizations. Together with the pensions, the salary improvement of the officials will be decided imminently and retroactively from January 1.


The special pension system for civil servants becomes the responsibility of Escrivá

Another of the most urgent issues for the department of Díaz – which bounce affects Social Security because it is the reference for the contribution bases – is to specify how much the interprofessional minimum wage (SMI) will rise this year. A measure of draft, if you consider the controversy raised in 2019 when it rose 22%, to 900 euros. The coalition program only establishes the commitment to reach 60% of the average salary in 2023. There is no consensus to set a figure – there has been talk of 1,200 euros, 1,150 and even since CC.OO. of just over 1,000–. In any case, the Government is only obliged to communicate to the social agents the decision taken in this regard. Employers and unions expect the Executive to summon them throughout this week.


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