Escrivá suggests ‘baby boomers’ in Spain may have to receive less pension

José Luis Escrivá suggests that ‘baby boomers’ in Spain may have to receive less pension or work longer

José Luis Escrivá, the Minister of Inclusion, Social Security and Migrations, announced today, Thursday 1, that the implementation of the new intergenerational equity mechanism will mean “a small adjustment in his pension” for the ‘baby boom’ generation – those born from the late 1950s to the mid-1970s.

In an interview on TVE, the minister explained that this generation, called ‘baby boomers’, is “wider” and will have to assume “some of the effort that must be made to moderate pension spending during a specific period of time”, and to facilitate this, he stated that they will be able to “choose between several options: one may be a small adjustment in their pension, which would be very moderate, or alternatively, they could work a little more”.

Escrivá said Spain “does not have an acute pension problem”, but “a temporary problem”, to face the increase in spending that the retirement of this generation will entail, since it will later correct itself at a later date.

This agreement between the Government and social agents, with the first package of pension reform measures, contemplates the replacement of the sustainability factor by a new intergenerational equity mechanism that will be defined in another five months and that will begin to be applied in 2027.

The mechanism of Intergenerational equity will replace the sustainability factor of the 2013 reform, an element Escrivá claims was “ill-defined” because it linked pensions “to life expectancy for all and indefinitely,” and brought the entry of this reform into place at the end of this year.

In statements to the media – after the signing of the pension reform agreement in La Moncloa – the general secretaries of UGT and CCO unions both criticised Escrivá’s lack of prudence in having made this approach on the day the agreement was signed, and before the negotiations had begun to define this equity mechanism, which will start to be applied in 2027.

Sordo made it clear that the commitment of the unions is that these generations have pensions “equivalent to those that we are currently paying”, and the CEOE stated that it does not agree with a “moderate adjustment” of the baby boomers’ pension, and made it clear that this claim “is not part of the agreement reached”, as reported by diariodesevilla.es.

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