For several years, each December the Government had been setting a percentage to which pensions would be adjusted for the next twelve months. But, as a consequence of the entry into force of the first reform of José Luis Escrivá, this 2023 the contributory benefits are linked to the CPI. Four months ago, the Treasury technicians estimated that this update would be 8.5% and finally, after knowing that inflation in November stood at 6.8%, it was possible to verify that the Government was not wrong when designing the expected spending, which will be 8.46%, according to the National Institute of Statistics (INE).
According to Law 21/2021 on the guarantee of the purchasing power of pensions and other measures to reinforce financial and social sustainability, “Social Security benefits in their contributory modality, including the amount of the minimum pension, will be revalued at the beginning of each year in the percentage equivalent to the average value of the interannual variation rates expressed as a percentage of the Consumer Price Index for the twelve months prior to December of the previous year”. This will be the first year in which the new legislation is applied to guarantee that the nine million pensioners do not lose purchasing power. Although it is true that in 2022 it was already revised and an “extra payment” was added in February to compensate for the price escalation.
This is an increase that will affect all pensions that were in force as of December 31, 2022 and not only those that were in force a year earlier, as was the case when the compensatory payment was given. The cost of this revaluation of almost 8.5% will cause an investment of between 14,000 and 15,000 million euros, which will be consolidated for the rest of the pensioners’ lives in their monthly payroll. The following revaluations will be made on this updated amount. When will the first amount that includes the increase be charged? Some pensioners may receive payment as of January 21, which falls on a Saturday. But the banks that normally take longer to pay will do so around the 26th.
Minimum and maximum amounts of the contributory pension
In Spain, 463,657 pensioners receive the maximum pension. With the revaluation of the CPI, this month they will collect 3,059.2 euros per month in 14 payments, that is, 42,829.29 euros per year. In total they will add a monthly increase of 240 euros with respect to the pensions of this 2022 in 14 payments (13,521.71 euros per year). If you do not have a dependent spouse, this minimum benefit will be 782.7 euros per month in 14 payments; if you have a spouse but not a dependent, it will be 10,401.31 euros per year (742.9 euros per month). The rest of the intermediate pensions will also observe this increase in their respective amounts.
The maximum pension will exceed 3,000 euros for the first time
However, according to the latest Social Security Financial Economic Report, there are 2,917,122 retirees whose contributory benefit did not reach 900 euros in July 2022. Therefore, with everything, and despite the fact that this increase far exceeds the previous ones, almost half of the pensioners in the country will receive less than the Minimum Interprofessional Wage (SMI). Specifically, 2.91 million of the 6.25 Spanish pensioners will continue to live without even being mileuristas (46.5%). Along the same lines, more than a quarter of the total will remain below the poverty line, defined at 800 euros by the INE (11,202.20 euros per year for a person living alone). Although it is true that this rate could be reduced with the granting of additional aid.
Maximum and minimum amounts of the non-contributory pension
Non-contributory pensions, that is, the lowest, managed by the autonomous communities together with Imserso, will maintain the 15% increase and their recipients will continue to receive the increase that has already been applied to them since last July 202 at a agreement between the Government and EHBildu. So it is not an extraordinary rise, but they will continue to collect the same amounts that they have been receiving since they were revalued, initially on a temporary basis until December. For the treasury arcades, it will mean an additional outlay of 400 million euros, compared to 224.10 million the previous year.
In short, the full non-contributory retirement pension stands at 484.61 euros per month and the minimum non-contributory retirement pension (25%) will be 121.15 euros per month. If more than one non-contributory pension beneficiary lives in the same family, the individual amount for each of them is established at 411.91 euros per month if two beneficiaries coincide and 387.68 euros per month if three or more coincide.