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The pension reform is validated today in Congress

The reform, with numerous measures to increase income, seeks to guarantee the "sustainability, sufficiency and fairness" of the pension system in view of the spending peak scheduled for the end of 2040 with the retirement of the so-called baby boom generation, as defended the Minister of Inclusion, Social Security and Migrations, José Luis Escrivá.

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The pension reform is validated today in Congress

The reform, with numerous measures to increase income, seeks to guarantee the "sustainability, sufficiency and fairness" of the pension system in view of the spending peak scheduled for the end of 2040 with the retirement of the so-called baby boom generation, as defended the Minister of Inclusion, Social Security and Migrations, José Luis Escrivá.

Together with the reinforcement of income, via increases in contributions mainly for the highest salaries, the reform includes measures to reduce the gender gap and the possibility of choosing to maintain the current calculation period of 25 years to calculate the pension or the progressive model of 29 years discarding the two worst. The norm, which will be processed as a bill, reaches Congress with the support of the unions and Brussels but without that of the CEOE.

The coalition government already has sufficient support for the validation in the plenary session of Congress of the decree law that reforms the public pension system. To the 154 votes of PSOE and Unidas Podemos at least, the 13 of ERC will be added, the six of the PNV (which has not yet confirmed if it will vote in favor or will only abstain), the five of Bildu, the four of PDeCAT and the three from Más País and Compromís, which gives the Government the numbers since it starts with at least 185 deputies, ten above the absolute majority.

Escrivá has defended in Congress that the reform "makes it possible to address the demographic challenge" through a "set of balanced measures" that will guarantee "the sufficiency" of the system: "it is an absolute change of paradigm, not only in Spain, but also in Europe. It does not introduce spending cuts, but an increase in income", he stressed, stressing that the measures will serve to "extend, guarantee and generalize new rights in terms of social protection". "It is a reference, you will see, for other European countries due to its balanced approach", a "rigorous" reform that "eliminates uncertainty and the cuts of previous reforms for present pensioners but, above all, for future pensioners".

Escrivá recalled that, with this reform, "the fifth and last regulatory change", the Government has fulfilled the mandate given to it by the Toledo Pact and, at the same time, the commitments acquired with Brussels in the Recovery, Transformation and Resilience (PRTR), already sure that it is designed for "the great social majority" collecting the 22 recommendations of the Toledo Pact that are based on three pillars: guaranteeing the sufficiency of pensions, reinforcing equity and solidarity, and strengthening their solidarity .

The minister has indicated that the new calculation of pensions, with the introduction of the formula of 29 years minus the two worst, which will coexist for a time with the current calculation of 25 years. "These two alternatives are designed to benefit more people, including those whose careers have been affected since the financial crisis."

He also alluded to the Government's commitment to closing the gender gap in the pension system, with an improvement in the gender supplement of 30.4 euros per child and the improvement in the treatment of contribution gaps that mainly benefits women who have had to interrupt or cut back on their work activity due to maternity or family care.

Likewise, the minister referred to the deployment of the Intergenerational Equity Mechanism (MEI), which will be gradually applied, from the current 0.6% to 1.2% in 2029 to replace the sustainability factor, approved without consensus in 2013, never applied and repealed in 2021", indicated the minister.

Escrivá has added that this reform is also thinking of young people, for whom "contribution is included for internship periods, whether they are paid or not" as of October 1, 2023. and has also cited the new real income contribution system for self-employed, in force from January 1. "It will result in greater equity in the system for better treatment of a group that is always underprotected in Social Security."

Regarding the rise in prices that the reform entails, Escrivá maintains that the reform does not imply "in any case the deterioration of competitiveness" in Spain since the reform is "reasonable and perfectly acceptable", since it supposes an increase of 10 cents in the cost of the worker in the short term and reached 37 cents at its maximum at the end of the 40s.

The PP has already announced that it will vote "no" because it considers that it "opens the door to lower pensions" in Spain, sources from the PP leadership have advanced, and they assure that Alberto Núñez Feijóo will repeal it if he arrives at the Moncloa Palace and Vox and Ciudadanos have also announced their rejection of the norm.

The PP spokeswoman, Cuca Gamarra, confirmed yesterday that her group remains against the reform, because "they have not received the information from the Government" that the reform guarantees the sustainability of the system, something that the coordinator of the economic area of ​​the PP in Congress, Jaime de Olano, has ratified today during the debate. A "frontal opposition" to the norm, both in substance and in form, because it will harm both SMEs and workers, who will have to "contribute more" to have "the same pension or even less."

Olano has said that the law will be approved "outside" the social dialogue and the Toledo Pact. "We have found out from the leaks to the press," said the economic coordinator, who added that the Government's promise to process the decree as a project will have little effect because the reform is conditional on the delivery of European funds, so predictably the European Commission will hardly allow touching the approved text.

For Olano, this is a "regrettable" way of legislating, if one also takes into account that the price of training practices has not taken into account the opinion of businessmen, universities or even the Ministry of Education, according to the PP deputy.

Olano has also resorted to the recent report by the Independent Authority for Fiscal Responsibility (AIReF), which ensures that the new reform will increase the Social Security deficit. He assures that Escrivá is going against "everyone" and also against the body that he himself led years ago. He maintains that from now on the self-employed will have to contribute 200 euros more on average to receive the same pension or less, and the State "will keep" 63% of the gross salary of qualified workers. In short, he has maintained, "the PSOE raises pensions for a few years" to "end up cutting them", since, as explained by the PP deputy, the reform includes proposing for 2025 a "new cut in salaries or pensions for all" .

Ciudadanos has also confirmed its "no" to a reform that they call a "robbery" and of being "a patch" for the system and Vox also rejects the measures included in the norm.

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