Spain will close 2023 with total payment 10.1 million pensions for 9.2 million retirees. For this purpose, SSI allocates an average monthly allowance of 12,120.8 million euros, that is, throughout the year. 11.5% of GDP This is the state of the Spanish economy, made public by the Ministry of Participation on Tuesday. If the 3.8% revaluation planned for January 1, 2024 is not implemented, pension The average monthly cost for the entire system is 1,198.7 euros (in 14 payments).
Public expenditures to support the public pension system have been increasing in recent years. Partially due to the increase in the retired population receiving social assistance; Almost 20 percent of the Spanish population is retired. Partly due to the increase in their quantity. For example, people who are now retired earn on average 1,398 euros per month; This is 16% more than retirees already recognized by the system.
However, the recovery and expansion in the economy since the Covid epidemic and its first crisis The weight of public spending on retirement has decreased Regarding GDP. In 2020, when the economy experienced an unprecedented contraction due to quarantine, Spain spent 12.4 percent of GDP on pensions, while today it spends 11.5 percent.
More liabilities and more income
The latest pension reform, designed by the previous minister José Luis Escrivá, increased the system’s obligations to retirees. For example, aligning benefits with annual updates inflation. This will cause the average pension for the entire system to rise from 1,198.7 euros today to 1,244.2 euros per month starting next week.
When this is added to the gradual aging of the population, higher expense. Today Spain spends 11.5 percent of its GDP on pensions, and in 2019, before Covid and the reform, this rate was 10.9 percent.
Although the norm approved by the coalition government also changed the balances earn more income. And when added to the expansion of the labor market (more people contributing to pay pensions), it adds more money to the Social Security fund. Right now Social contributions increased by 9.7%. If the new Intergenerational Equality Mechanism (MEI) is excluded from this calculation, if there is an increase in contributions through quotas from employers and workers, they will do so by 8.1%.
Currently the public system pays 10.1 million pensions per month to 9.2 million retirees – there are people receiving two pensions. The pension benefit that benefits the most is pensionWith 6.3 million people. 60.1% of them are men; In the case of the widow’s pension, 95.9% of the 1.5 million people receiving this pension as the main benefit are women. On the other hand, there are 941 thousand 281 permanently disabled, 323 thousand 140 orphans and 44 thousand 891 family members.