The Government approved on Tuesday in the Council of Ministers a Royal Decree that indicates what the Independent Fiscal Responsibility Authority (Airef) should consider when making the report that will evaluate the measures taken by the Executive since 2020 to strengthen the income of the Social security. The rule, which was approved on Tuesday, It was not mentioned at the press conference after the Council of Ministers And it will take effect tomorrow after its publication this Wednesday in the Official State Gazette (BOE).
The objective of the Royal Decree is Regulate the monitoring of impact projections Dear of the measures adopted in the pension system from 2020 in accordance with the ‘closing clause’ established in the latest pension reform. The so -called ‘closing clause’ is a mechanism that allows airf to monitor the evolution of pension spending. Depending on its results, it could lead to the adoption of measures to guarantee the financial sustainability of the Social Security System. That is, to a rise in the contributions.
As explained by the BOE, if the Airef report-which must be published before April-concludes that the estimated net expenditure on pensions of the 2022-2050 period exceeds 13.3% of GDP, The Government must propose a series of measures aimed at eliminating excess expense. The measures may be aimed at an increase in social contributions or “another alternative formula to increase system income.” On the other hand, the measures could also be aimed at a reduction in expenditure on pensions in percentage of GDP, or a combination of both.
Once the document is published, the proposal of government measures will be negotiated with the social agents. Once the proposal is designed to correct the deviation between income and expenses, the Government will send it to the Toledo Pact Commission and approve a bill that contains said measures for its remission to the Cortes.
Increased Mei
Likewise, the BOE contemplates that in case of not achieving a consensus on what measures they should be adopted, the quotation of the intergenerational equity mechanism (MEI) would be raised. This case would occur if the bill was not in force on January 1 of the following year.
In the reasons for the Royal Decree approved on Tuesday, the Government indicates that this rule specifies indeterminate or inaccurate concepts to take into account in the ‘closing clause’. “Legal certainty reasons, as well as the requirement that evaluations and reports (of the airf) present a faithful estimate of the income and expenses of the Social Security System and adapted to the date of its realization so that the Adequate measures determine the need to specify certain contents, “the Executive alleges.
Thus, in the face of the Airef report, the text is required that the Social Security System and the Special Passive Classing Regime will be understood, while identifying the concepts, while identifying the concepts They are considered income from the public pension system, mentioning in a “express” way, due to their relevance, the transfers of the State to the Social Security Budget that annually contemplates the Law of General State Budgets.
An “faithful” estimate
On the other hand, the Executive also addresses in the decree that for the preparation of the report, the Airef will have to consider All social security income: The progressive contributions of the State and those that are agreed for special attention or are precise due to the requirement of the situation, the social contributions, the amounts collected in concepts, sanctions or others of an analogous nature, the fruits, income or interests and any Another product of the Social Security Patrimonial Resources, and the resources established for the financing of the Special Passive Classing Regime of the State.
The text also points out that the agency chaired by Cristina Herrero will have to jointly quantify the impact of the measures adopted on the income of the system by 2022-2050 in percentage of GDP for this period, and make it clear that, to perform this quantification, The measures that have a direct impact on the income of the public pension system, such as the elevation of the maximum and minimum contribution bases, the rise in the types of contribution and the establishment of additional contributions such as (MEI) and the additional share of solidarity. The airf will also have to take into account the measures that affect the number of people forced to quote, as well as the reforms of the labor market and other labor or employment standards that structurally, directly or indirectly, in the income of the Public pension system.
“For guarantee a faithful estimate of the expenses of the Social Security System ” Adapted to the date of its realization, the Government determines that the AirF projection exercise will start from the “observed” data. “Otherwise, the exercise would depart from the present and current reality and would enter into a theoretical exercise that would not reflect the reality of the system at the time of its evaluation,” warns the Executive.
In this sense, the rule indicates that the AirF report will have to use the macroeconomic and demographic assumptions that have been established in the latest aging report published by the European Commission when no observed data is published that have been published by the Institute National Statistics (INE) or the appropriate official sources, specifying that certain data must be provided by the Ministry of Inclusion, Social Security and Airef migrations.
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