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Pensions will increase by 3.8% in 2024 to compensate for inflation

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Pensions will increase by 3.8% in 2024 to compensate for inflation

Pensions are expected to increase by 3.8% in 2024, according to the average inflation of the year. This is another forecast, “not closed”, the Ministry of Social Security indicates, because the latest CPI data known today – from November – is still provisional. Sources from the department currently led by Minister Elma Saiz determined that the increase in the number will be confirmed “at the end of the year.”

The increase in pensions thus follows the pension revaluation mechanism approved with the last coalition government, in the first leg of the reform agreed with unions and employers, to continue the purchasing power of pensioners according to the average inflation from last year. .

The resulting average increase at the end was somewhat lower than the estimate of the Ministry of Social Security a few months ago, 4%, mainly due to the lower increase in prices at the end of the year. This November, the number dropped from 3.5% in October to 3.2% year-on-year, due to lower prices of gasoline and electricity.

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The minimum pension is expected to rise by 6.8%

For its part, the Ministry of Social Security has already reported that it foresees that the minimum and non-contributory pensions, the lowest in the system, will increase further, by 6.8%.

As for the increase in the pension package, the Ministry of Social Security says that the increase is “not yet closed”, so we will have to wait until the end of the year to confirm the figure.

The forecast corresponds to the report ‘Public expenditure projects on pensions in Spain’, published by the Ministry in October. In this, improvements to the lowest system pensions are planned for the next four years, as agreed in the last pension reform.

According to the estimates of the Executive, the minimum retirement pension contribution for those aged 65 or over with a dependent spouse will be from 13,527 euros per year in 2023 (966 euros per month in 14 payments) until 16,472 euros per year (1,177 euros per month) .in 2027, almost 22% more.

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In the case of the non-contributory pension, it is expected to go from 6,785 euros per year (485 euros per month) in 2023 to 8,236 euros per year at the end of the period (588 euros per month).

As has been done in recent years with the minimum wage, the Government has agreed to the pension reform to establish a goal for these benefits in relation to the poverty line, so that these low pensions are slow -slowly move towards this reference.

Still waiting for the IMV increase

The Ministry of Social Security is also responsible for another important increase of many families in poverty: the increase of the minimum essential income (IMV).

Once again, the Ministry led by Elma Saiz explained that the number is not closed at this time, but if the law regulating the minimum income of the state is used, it is established that the IMV will be revalued every year as non-contributory pensions. In other words, the forecast points to that 6.8%.

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In any case, we will wait for the official figure reported by the Government, which increased the IMV by 15% in March 2022 due to the war in Ukraine and the inflationary crisis. Although it was initially a three-month increase, the increase was extended and continued in 2023 as well.

On the other hand, we also need to see what the so-called “childhood aid supplement” will look like in 2024, the monthly aid per child for low-income families, but it exceeds the income limits of the IMV (up to three times more. ). In 2023, the amounts, for each child:

  • Children under three years: 115 euros per month.
  • More than three years and less than six years: 80.50 euros.
  • Over six years and under 18 years: 57.50 euros.