According to the consumer price index (CPI) data, inflation fell again for the fourth month in a row in November, falling to 6.8%, five-tenths of the 7.3% recorded in October. National Institute of Statistics (INE). If, on 14 December, the INE confirms the data released this Tuesday, average inflation of the last twelve monthsIt will be at 8,458% until November, and the following can be deduced from it: pensions Social Security will increase by 8.4% as of January 2023, although the data is not yet final. The 8.4 percent increase is one-tenth below the Government’s estimate included in the 2023 Budget project currently under discussion in the Senate. The minimum living income is expected to increase at the same rate. According to Airef estimates, a one-tenth lower increase in pensions could mean a lower expenditure of around 150m euros in the Budget.
After the pension reform enacted in January 2022, November inflation data are important to determine the increase in pensions next year. From now on, the amount of pensions will be reassessed each year according to: average inflation “twelve months before December of the previous year”; in this case, both months are included, based on average inflation from December 2021 to November 2022. Inside December 2021 Inflation had already climbed to 6.5%. Then Russian invasion of Ukraine Prices rose in February the Energy and eat It pushed inflation to a peak of 10.8% in July and has eased in the four months since. The average for these last twelve months stands at 8.4%, and the 6.8% for November, which was approved by the INE on December 14, rose this Tuesday.
With the new pension revaluation system based on the previous year’s inflation, January’s ‘paguilla’ is disappearing Up until now, the increase in compensation was determined by the estimated inflation and there were upward deviations from it.
According to his estimates, Independent Institution for Financial Responsibility (Airef), each point of increase in pensions represents approximately a larger expense. 1.5 billion €. Thus, an increase of 8.5% represents an additional expenditure of approximately 12,750 million for Social Security and this amount has already been provided in the 2023 State Budget project.
Beyond the effects of November inflation for the rise in pensions, the data released by the INE this Tuesday represent a new step towards correcting the price increase that the Government expects to consolidate in 2023. The annual rate of 6.8% is four points below the July peak of 10.8%, which makes Spain one of the countries with the fastest and most intense decline in the European Union. From the government’s point of view, the decrease in inflation reveals the positive effect of the measures taken to limit price increases.
On his behalf, call Core inflation (not taking into account the more volatile energy and unprocessed food prices) was held at 6.3% in November.