After the agreement for the first part of the reform of the public pension system, both the experts and the social agents and the Executive itself assume that the thorniest aspects of the plan of measures will be discussed in the second part of the negotiation , the next 2022. One of the elements that the Ministry of Inclusion, Social Security and Migrations has left pending is the extension of the years of contributions for calculating the pension. At the beginning of this year, it was speculated based on the leaks of documents that would have been sent to Brussels that the expansion of the 25 years listed at 35 years, for the calculation of the regulatory base of the retirement benefit. If this assumption is carried out and taking into account the different Social Security regimes, the self-employed would be the most affected with more than one 10% average reduction in pensions, while the decrease for salaried workers by an increase of ten years in the calculation period it would be 8.6%.

Although the final document, approved by the European Commission, does not reflect the specific number of years in which the calculation period, it is referenced that it will be one of the measures that come into force as part of the reform of the public system . Here, sources close to the negotiation assure this medium that it is one of the measures that will be put on the social dialogue table for the second leg of the reform , although they clarify that the eventual The increase in years of contributions for the calculation would be accompanied by a benefit by which the contribution gaps – those periods in which the worker has not been able to contribute to Social Security due to cuts in their work activity – would be compensated by Social Security.

More tax However, whatever the decision is adopted at the dialogue table, this increase in years of contributions for calculating the pension is one of the ways that political parties outline in the Toledo Pact recommendations for increase the contributivity of the System . In other words, so that the pension is more and more correlative to the volume of contributions made during working life. For this reason, the parties call in this recommendation to progressively increase the contributivity of the System, in which an integration of the special Social Security regimes is also proposed to facilitate the process. However, the result of the measure seems that it will bring a decrease in the average pension, in most cases.

Although the increase in the calculation period does not necessarily imply a reduction in the amount of the initial retirement pension – it may happen that a worker has been harmed by a cut in your career in recent years, prior to retirement, in which case the measure would benefit you assuming an improvement in the benefit compared to if they had been taken 25 years listed instead of 35 years-, in most cases, due to the simple upward path of remuneration that is assumed in all jobs, this extension would take more years than the initial ones, less fruitful, worsening Thus the calculation of the pension.

Specifically, the calculations made by the Research Group on Pensions and Social Protection, this measure would mean, on average, for pensioners a cut in the initial amount of the pension. 8.6% pay. However, if we differentiate between the general scheme for salaried workers and the self-employed scheme, a notable difference can be seen. If wage earners would assume on average a reduction in pay also of 8.6%, the self-employed would see this cut rise to 10,3%. “The self-employed regime would be more affected, with a drop in 10, 3%, compared to the 8.6% reduction in the general scheme , due to the fact that the contribution gaps are not included in the self-employed scheme, that is, the unlisted months are calculated at zero euros, strongly penalizing the value of the regulatory base “, the study authors point out.

Further, the study’s expert authors point to the convenience of carrying out carry out this measure gradually. The increase in the number of years, from 25 to 35, for the calculation of the regulatory base “is a measure that would improve the contributivity of the system, by increase the ratio between contributions and benefits, but it also affects the amount of the initial pension. Furthermore, from the point of view of greater contributivity, it would be convenient for the calculation period to be extended to the entire working career . Naturally, it is recommended that this process be done gradually, with periods that span at least a decade, “they point out.

Further, on the determinants that imply the variation in the amount of payments, it is observed that the effect of the extension of the calculation period depends more on some characteristics than on others. The most relevant is the duration of the working career, since the short careers would see their regulatory base decrease by 14, 9%, compared to long careers (equivalent to more than 43 years and eight months of contributions), which would suffer a half reduction (7.5%). “As a consequence, women , who have shorter careers, would be more affected by the change, and indirect discrimination on the basis of gender may occur”, the researchers warn.

The explanation of the influence of the different duration of the working career on the regulatory base is by the method of integration of the gaps : the shorter the working career more need for gap integration when going from 25 to 35 years and a greater number of them with the 50% of the minimum base than with the 100%. In addition, the retirement age also has a relevant effect, the impact on delayed retirements being greater (11, 6%) than the anticipated ones (7.9%), the ordinary ones being in an intermediate situation (8.9%). “A good part of this effect is due to the negative correlation between retirement age and working career and not due to the age effect itself,” they conclude.

Source:

1-Business – Wikipedia

What is meant by business?

A business is defined as an organization or enterprising entity engaged in commercial, industrial, or professional activities. The term “business” also refers to the organized efforts and activities of individuals to produce and sell goods and services for profit.

RECENT POSTS Don't Miss POSTS