Increase in pensions: what about complementary?

by time news
Increase in pensions: what about complementary?

PENSION INCREASE 2022. To take inflation into account, basic retirement pensions will increase by 4% this summer. What fate will be reserved for supplementary pensions? We take stock.

[Mis à jour le 23 juin 2022 à 08h19] A major focus of Emmanuel Macon’s presidential campaign, pensions are now one of the main projects of his second five-year term. Moreover, since Together! lost its absolute majority in the National Assembly after the last legislative elections. From now on, the government will have to forge alliances to remedy the forty votes it lacks to pass its texts. Still, basic retirement pensions will increase by 4% on July 1, 2022. Be careful, the increase will not be visible in July! As the pension for the month of July is paid only in August, the increase will actually take place from 9 August for the basic schemes! But then, will an increase take place for supplementary pensions?

Supplementary pensions are managed by the social partners and generally revalued on November 1 of each year. In fact, the 4% increase will not be applied. The unions, for their part, were demanding a 4.5% increase with retroactive effect from January 1, 2022. A request which should not be accepted by the executive. The 4% increase in July should represent an additional 28 euros on your basic pension, for an average basic pension of 704 euros per month. Do you want to know how much a 4% increase on your pension represents? Here are some examples :

  • Pension of 1,200 euros: 1 248 euros
  • Pension of 1,400 euros: 1 456 euros
  • Pension of 1,600 euros: 1 664 euros

The rules for increasing supplementary pensions (Agirc-Arrco, for example) differ from those for basic pensions. These supplementary pensions are calculated from the number of points acquired during the career, to which a value of the point is multiplied. Then, the social partners decide on a possible revaluation of the value of this point. Generally, these pensions are increased every year on November 1st. In 2021, the value of the Agirc-Arrco point was revalued by 1%. It therefore went from 1.2714 euros to 1.2841 euros. Regarding these supplementary pensions, the Minister of the Economy Bruno Le Maire was clear: “It is up to the social partners to upgrade supplementary pensions. We will increase the basic pensions.” So, a little more patience to know the next revaluation of the index point!

Adding to the increase of just over 1% in January, the total increase in pensions in 2022 is therefore 5%. This represents a gain of 60 euros for a retirement pension equal to 1,200 euros according to Prime Minister Elisabeth Borne who gave this figure during an interview with France Bleu on June 7, 2022. Please note, this is not however not the exact amount that will be displayed on your total pension since it should be remembered that this increase only concerns basic retirement pensions, excluding supplementary ones. However, the average in France for basic pensions is 704 euros according to the statement of the National Pension Insurance Fund, the CNAV. If we take this figure, the 4% gain expected this summer represents an increase of 28 euros per month.

The 4% increase results from the inflation that has been affecting France for several months. It is therefore an alignment with inflation to help combat the loss of purchasing power. However, this decision is a significant development compared to the policy deployed by governments in recent years. For 10 years, retirement pensions were no longer indexed to inflation despite its inclusion in the Social Security Code, resulting in a loss of purchasing power of more than 10% in 10 years according to the orientation council of retreats. However, this 4% increase should not completely satisfy several pensioner unions who were demanding an increase of at least 4.5%, with retroactive effect from January 1.

The overall retirement pension for civil servants consists mainly of the basic pension. A supplementary scheme, the “additional public service pension (RAFP)”, concerns 20% of the amount of the annual gross index salary, at most. De facto, the increase in pensions on July 1, 2022 should be greater for civil servants than for other pensioners.

The next pension increase will be effective from July 1, 2022, the government has confirmed. De facto, the very first visible increase in retirement pensions will be visible during the first payment, the following month, namely August 9, 2022, a date announced by the Minister of Labor Olivier Dussopt in early June. “We want this indexation to inflation to be valid for pensions in July. Under the general scheme, the pension for July is paid on August 9,” he explained then.

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