“Spain must guarantee the stability of its pension system”. Vice President of the European Commission for Economic and Trade Affairs, valdis dombrowskiIt was reiterated yesterday between congratulating the government for its speed in launching the recovery plan – the first that was approved by Brussels – and for the proper orientation of some of its reforms, such as labor reforms, already well known about Message Spanish public pension system.
The point is that this time the message has been started by the technicians of the Commission after a long meeting with the people responsible for the Ministry of Inclusion and Social Security to find out how state of improvement of pension, the outcome of the measures already approved, the schemes of the government for which they are pending and the estimates to which they can contribute.
The balance of the meeting held last Tuesday by the Minister of Inclusion and Social Security, Jose Luis EscrivaReduced the discrepancies with Brussels to “technical” issues and suggested that they would not mean major problems when it comes to overcoming the final assessment of the reform.
Sources from other actors who have met with Brussels technicians these days add to the depth of the discrepancy. Not only because it affects the STAR mechanism devised by Escriva to address threats to the stability of the pension system, Intergenerational Equity Mechanism (MEI), but because it refers to the very essence of the mechanism.
The Minister of Social Security has tried at all costs to prevent the mechanism from setting up an automatic adjustment system when the income from contributions is less than the expenditure on contributory pensions, something that has been happening for three decades and continues for some more. years, as this will almost certainly require either increasing the number of years taken into account for calculating the pension, along with a corresponding reduction in payroll, or delaying the legal retirement age.
As in ABC. is reported byHowever, the European Commission wants just the opposite. A mechanism similar to the Sustainability Factor of the 2013 pension reform that Escriva insisted on liquidation and assured Brussels that the Spanish pension system would be automatically adjusted as factors causing financial instability became apparent, either your accounts Factors such as an increase in life expectancy by imbalance or other factors.
at the starting point
Commission technicians almost leave Spain with the same doubt With those who arrived and they already disclosed in their favorable report for the first phase of pension reform. He then emphasized that the measures adopted in Spain guaranteed the adequacy of benefits, one of the objectives agreed between Brussels and Madrid in the recovery plan, but acknowledged his doubts about stability.
Commission sources yesterday admitted that they were not able to make a full assessment of pension reforms and that it would not be possible unless the pending measures are definitely cleared. “We haven’t seen the measures, we haven’t seen the numbers And we haven’t seen the screening, so until we see it all, we won’t be able to do a full evaluation.”
And in all this, the commission includes a total or partial extension of the contribution period that is taken into account for calculating the pension, an issue that the Ministry of Inclusion and Social Security is already dealing with. publicly denied extending it to 35 years and assesses a number of alternatives that according to Jose Luis Escriva “in no case will the profit be diminished”; raising the maximum wage ceiling to which social contribution applies, called ‘withholding of maximum bases’; and, attention, the Intergenerational Equity Mechanism.
Brussels don’t end that gameNo matter what, Social Security already closed its structure with a 0.6% increase in contributions (0.5 points by the company and 0.1 points by the worker) to create a new pension piggy bank and evaluate the results in the year 2032. , in which the possibility of adopting other adjustment measures will be assessed mainly from the income side, but will also open the door to reduction in final expenditure.
It has already slipped from Social Security that it will not resist introducing changes to the system if Brussels moves its assessment of pension reform to the point.
In the absence of significant adjustments on the expenditure side, which would reassure European Commission officials, unsure of the government’s strategy of bringing financial balance to the pension system by increasing social contributions, the government has turned to benefits for employment to shine. his labor is going to be reformed And this effect will have a pleasing effect on Social Security accounts through improved income from contributions.
Commission sources acknowledge that if labor reform translates into an improvement in the level of employment and its quality, as the government has promised, it will be an important parameter when assessing the future stability of the pension system. But they also caution that another important parameter would be to examine the effect that potential increases in contributions have on the labor market because, they argue, they raise companies’ labor costs and affect incentives in the labor market. Huh.
“Pension spending in Spain remains significant and we must ensure that it does not increase rapidly,” he told the commission yesterday. “Obviously if the measures that are taken do not make progress in terms of stability, we will talk with the Spanish government. make sure the improvement contributes to that objective agreed with the Commission’.