Pensions, increases for pension allowances from 1 January 2022. The amounts of pension allowances are set to increase as early as 2022 and probably more than expected.
This is good news, but one that could compromise the reform aims of the Government, which – as is well known – is reflecting on the possibility of introducing new measures with which to guarantee flexibility in the output of certain categories of workers. There are, in fact, about 4 billion good reasons why the government might even have to give up the reform.
This, according to the calculation carried out by Repubblica and as stated on https://www.money.it/, the outlay necessary to guarantee the increase in pensions expected from 1 January 2021, which will be favored by an increase in higher than expected inflation rate.
As is known to most people, every beginning of the year the amounts of pensions are adjusted to the trend of inflation thanks to the mechanism known as equalization.
A revaluation that overall will concern 22.8 million social security checks, which will have to be revalued taking into account the increase in the cost of living. A necessary mechanism to ensure that pension checks do not lose purchasing power over the years.
And it is no secret that the cost of living has risen sharply this year: just think of the increase announced for electricity and gas bills, as well as the prices of food products, such as pasta. For this reason, the revaluation chapter of pensions this year could require a significant outlay from the state.
In detail, for the revaluation of pensions, the FOI index elaborated by Istat will be taken into consideration, which takes into consideration the variation, in the last year, in consumer prices for families of blue-collar and white-collar workers. This increase was 2.1% in August, but according to the forecasts contained in the update note to the DEF, at the end of the year it will reach + 1.5%, and then rise further throughout 2022.
How the revaluation of pensions works in 2022
But there is not only the trend of inflation to consider. It should also be said that from January 1, 2022, a new pension revaluation mechanism, more favorable for citizens, is scheduled to enter into force.
We need to take a step back and go back to 1997, when the first Prodi government introduced a three-tier revaluation mechanism. Subsequently, however, the Monti government in 2011 – the year of the infamous Fornero reform – blocked the revaluation between 2012 and 2013 for all pensions exceeding 3 times the minimum treatment. There was then a new revaluation mechanism in 2014 with the Letta government, which, however, was less favorable than the one described by Prodi I as it was not in three brackets but in five. And again, in 2019, when the mechanism described by Prodi was to come back into force, the first Conte government intervened with the decree 4/2019 with which a seven-band mechanism was introduced (then reduced to six by the subsequent Budget Law ).
What are the differences between these two systems? The Prodi mechanism provides that:
full equalization (100%) below four times the minimum treatment;
equalization at 90% between four and five times the minimum;
equalization at 75% above five times the minimum.
The one in force until December 31 of this year, however, provides:
100% equalization for treatments that have an amount less than four times the minimum treatment;
equalization at 77% for amounts between four and five times the minimum;
equalization at 52% between five and six times the minimum treatment;
equalization at 47% between six and eight times the minimum;
equalization at 45% between eight and nine times the minimum;
equalization at 40% above nine times the minimum.
According to the program, therefore, the Prodi system should return, but it cannot be excluded that in the 2022 Budget Law there will be a new cut in the revaluation, so as to limit costs.
How much pensions increase in 2022
To understand by how much the checks will increase, therefore, it will first be necessary to clarify which of the two aforementioned mechanisms will be applied. If the 1.5% rate foreseen in the update note to the DEF were to be confirmed, then there would be increases ranging from 126 euros per month (for the lowest pensions) to an average of 1,027 euros for the highest allowances in the case where there should actually be a return to the Prodi mechanism.
With the method of the Conte I government, if this were to be renewed, there would instead be an increase ranging from 126 euros (since, however, for low pensions the revaluation is always full) to 484 euros per year. To be penalized, therefore, would be those who receive pensions of medium-high amount.