2023-05-08 00:04:55
The pension reform at the beginning of the year is having the opposite effect to what it was looking for: early retirements of workers, precisely those that were intended to be stopped with the new regulation, have skyrocketed in the first quarter of 2023 and they almost represent half of the new discharges, which is a maximum in the last decade.
What’s more, in the first two months of the year the usual trend was turned around for the first time and there were even more workers who decided to retire earlier than those who did so at the legal age: 30,904 compared to 30,289, according to data from the National Social Security Institute to which this newspaper has had access. This percentage of more than 50% has been slightly cushioned in the month of March, but even so, early withdrawals represent 45.1% of new registrations at the end of the first quarter.
In addition, they do so with a pension that for the first time is close to 1,800 euros per month on average, 421 euros more than that received by those who leave with ordinary age (1,353 euros).
Paradoxically, the reform designed by Minister José Luis Escrivá, whose ultimate objective is to extend the working life of workers in order to redirect the system to sustainability, has led to record levels of early retirement at the end of last year and at the beginning of 2023 despite the fact that they have hardened.
But behind this ‘boom’ of early retirement there is a clear cause: workers have advanced their decision to become pensioners in order to benefit from the sharp rise in benefits this year, a historic 8.5%. This is due to another of the measures that this reform has introduced: revaluing pensions with the average inflation of each year, whatever it may be, to guarantee the purchasing power of the elderly for life.
For this reason, the last month of 2022 produced such an avalanche of retirements, which became the December with the highest number of registrations in the historical series. And it was even the third month with the most withdrawals despite the fact that it is traditionally the one with the fewest registrations each year.
The workers who were on the verge of retirement, or who could do so early because they had contributed the necessary period, began to make their calculations… and what was their surprise to see that, despite the fact that there are strong penalties for early retirement, or it practically did not harm them or, even, the opposite case occurred that it benefited them to do it before the end of the year since they would earn more than if they did it when it was their turn, due to that 8.5% increase.
Thus, for example, it happens to those who can retire a year earlier. For this advance, a cut is applied to their pension of around 5% (a little more or less depending on the years of contribution) but, on the other hand, if they requested retirement before the end of December, that pension will later be the revaluation of 8.5% is applied, which more than compensates for this reduction. Thus, it is more advantageous for them to do it earlier since they would receive a higher pension (3.5 percentage points more) than if they do it throughout this year.
This is recognized by the Ministry of Social Security, which admits that there has been a ‘call effect’ that has encouraged retirement to be able to collect that 8.5% increase. In fact, this strong increase in early withdrawals in the first quarter of the year, with a weight of 45%, a level much higher than in previous years, is due to retirements requested in December but processed later, since that there is a period of 90 days to be able to recognize the new benefit, which is applied retroactively. From the ministry they consider that in the coming months its weight will be reduced and this year it may again mark another minimum, as happened in 2022, when early withdrawals represented 37% of all retirements.
It is worth noting the strong gap that exists between early retirement in the General Scheme and in the Self-Employed Workers Scheme (RETA). Thus, if the percentage of premature withdrawals rises to 48.6% among wage-earners (with data from March), it falls to barely 26.3% of self-employed retirements.
Checks of 200,000 euros
On the other hand, the new prizes that have been launched with the reform –with checks that have even exceeded 200,000 euros– have led to delayed retirement to maximums and almost 8% of workers extended their working life to be able to collect a higher pension, a percentage that is still insufficient but that exceeds the 5% environment that had been customary.
All these factors have contributed to the fact that the average pension is increasingly higher and stands at practically 1,550 euros per month.
In any case, Escrivá is managing to delay, even slightly, the real retirement age, which stands at 64.8 years, almost six months more than five years ago. Even those who do it before their time are already well over 63 years of age.
#Retire #early #earn