HE minister council approved a loan this Monday 10.003 million euros For Social Security, from which the Treasury will pay additional payments retirees of Christmas. The granting of the loan in question was already considered in the General Government Budgets (PGE) for this year 2023 and has become a common practice to balance public system accounts over the last decade. pensionGiven the ever-increasing increase in both the number of retirees and their amount.
Treasury Undersecretary Social Security Since 2012, it has needed additional reinforcements in order to fulfill all its obligations on time. Moncloa in the State in 2012 under the Government of Mariano Rajoy and in 2019 under the presidency of Pedro Sánchez He had to take money from what is known as his ‘retirement piggy bank’ to pay salaries.Because at the end of the year, more money was left in the treasury than entered. Partly due to the scarcity of contributors, partly due to insufficient salary increases, partly due to the demographic transition that is turning Spain into an increasingly aging country.
‘retirement piggy bankDesigned to act as a cushion as this aging intensified, ‘with more retirements for every active worker’, it reached its peak in 2011, when €66 billion 815 million was accumulated. Today it has 5.3 billion euros. And to put it into perspective, the October payroll cost the State €12,75 million. In other words, what is in the ‘piggy bank’ is not even enough to pay one month’s pension.
The trend of draining the reserve fund began to reverse this year with new contributions introduced in the latest pension reform designed by the Minister of Social Security (currently in office). José Luis Escriva. Among other things, from this year companies and workers pay slightly more in social contributions, and from next year a series of new increases come into force, with which the Government plans to support the sustainability of the system.
Widely application
‘Retirement piggy bank’‘ is decreasing, and government loans to Social Security are becoming more common to cover all expenses. Just like the one approved by the Cabinet this Monday. These injections, which mean transferring interest-free money from the Treasury to SSI, have become widespread since 2017. Payment is made especially for summer and winter overpayments. In 2022 and 2023, these payments are reduced to once a year. And the prediction is that starting next year, that won’t be necessary anymore and Social Security will be out of the loop.
“As in previous years, the disbursement of the loan today is Ensures timely payment of pensions and allows Social Security to plan the provision of necessary resources sufficiently in advance will have to face these extraordinary payments,” Social Security says in its statement.