by Belen Carreno
MADRID, March 10 (Reuters) – Spain’s socialists and their coalition partners Unidas Podemos have reached an agreement to reform the pension system that will put more of a strain on top earners, sources involved in the dispute told Reuters. the negotiations.
This pension reform is the main condition set by Brussels to allow Spain to be able to access the fourth installment of the European post-pandemic recovery fund for COVID-19.
It was a source of disagreement within the government coalition which was trying to find a mechanism to increase revenue without penalizing future retirees.
The leader of Podemos, Minister Ione Belarra, announced earlier in the morning that the government had found a way to increase the income of the pension system without affecting future retirees.
A government source told Reuters that Madrid had received initial positive feedback from the European Commission on the reform plan. The European executive indicates for its part that it has been informed of the project but that an official opinion will not be given for several months.
Other European countries have undertaken to reform their pension systems.
In France, the reform project, the flagship measure of which is the postponement of the retirement age from 62 to 64, is being examined in the Senate after heated debates in the National Assembly and comes up against opposition from the trade unions and a majority of public opinion. Several days of strikes and demonstrations have taken place since January 19.
In Spain, the last major reform of the pension system dates back to 2011 with the postponement of the retirement age to 67, but it did not make it possible to compensate for the increase in the costs of the system put under pressure with the increase in pensions. retirement under the effect of inflation which averages 8.5%.
The Spanish government wants to move forward with its project despite the opposition of the main employers’ organization, the CEOE. The reform project will be discussed on Friday with the main unions and the CEOE.
A “solidarity tax” will be put in place to temporarily abolish exemptions from social security contributions for high incomes. Most of this tax will be paid by employers.
The government also plans to double the rate of contribution to the “intergenerational equity mechanism” – currently at 0.6% – intended to increase revenue. According to the government, this mechanism should bring in 2.8 billion euros in additional revenue in 2023.
Even if the coalition government does not have a parliamentary majority, other left-wing parties are expected to vote in favor of the reform if it is supported by the unions.
The government will also have to persuade the unions to agree to increase the minimum number of years of contribution from 25 to 29 years, a key element of the reform project to have the approval of Brussels. (Report Belén Carreño, French version Matthieu Protard)
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