The Government was not one iota wrong when designing the expected pension revaluation expenditure in the 2023 General State Budget (PGE). The Treasury technicians estimated two months ago that this update would be 8.5 % for next year and, finally, after the CPI data for the month of November (6.8%) was made public today, it has been possible to calculate that the average annual CPI between December 2021 and November 2022 (both inclusive) will be 8.46%. That is, in the absence of the definitive data that will be known on December 14, what pensions will raise next year.
This is the first year in which the new pension law that came into force on January 1 has been applied and obliges governments to update pensions with average annual inflation with the inflation of the twelve months prior to the revaluation to guarantee that the nine million pensioners do not lose purchasing power, especially in periods of inflation shocks. Although it is true that in 2022 the increase in pensions was already revised and a payment was added in February to compensate for the loss of purchasing power.
In this way, the maximum pension for next year remains at 42,829.29 euros per year (3,059.2 euros per month in 14 payments). While the minimum retirement benefit for beneficiaries aged 65 with a dependent spouse will be 13,521.71 euros (965.8 euros per month in 14 payments). If you do not have a dependent spouse, this minimum benefit will be 10,958.58 euros per year (782.7 euros per month in 14 payments); and 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 pensions between the minimum and the maximum will see their amount increase by 8.5%.
For its part, the minimum widow’s pension, which 1.56 million people receive, will be 12,862.13 euros per year next year if the holder has family responsibilities (918.7 euros per month in 14 payments). In the chapter on permanent disability pensions, which are received by almost a million people, severe disability will be paid with 20,283 euros per year if the pensioner has a dependent spouse and with 16,438.63 euros per year if they do not. Finally, the more than 323,000 orphans who receive an orphan’s pension will receive a benefit of 3,352.43 euros per year (239.4 euros per month in 14 payments).
As a novelty for next year, this revaluation will affect all pensions that were in force as of December 31, 2022, since with previous update formulas the compensatory payment was given to those that were in force one year before.
The cost of this revaluation of almost 8.5% of pensions will cost Social Security between 14,000 and 15,000 million euros, which will be consolidated for the rest of the pensioners’ lives in the monthly payroll of these benefits, so the full cost is doubled by two (about 30,000 million euros). This means that the following revaluations will be made on this updated amount.
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