Pensions are expected to increase by 3.8% in 2024, according to the average inflation of the year. This is still a forecast, “not closed”, the Ministry of Social Security indicates, since the latest CPI data known today – from November – is still provisional. Sources from the department now led by Minister Elma Saiz specify that the increase figure will be confirmed “at the end of the year.”
The increase in pensions will thus comply with the pension revaluation mechanism that was approved with the last coalition government, in the first leg of the reform agreed with unions and employers, to maintain the purchasing power of pensioners according to average inflation. from the previous year.
The resulting average increase in the end has been somewhat lower than estimated by the Ministry of Social Security a few months ago, 4%, especially due to the lower rise in prices at the end of the year. This November, the figure has fallen from 3.5% in October to 3.2% year-on-year, due to the lower prices of fuel and electricity.
The lowest pensions are 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 much more, by 6.8%.
Like the increase in the pension package, the Ministry of Social Security states that the increase “is not closed” yet, so we will have to wait until the end of the year to confirm the figure.
The forecast corresponds to the report ‘Projections of public spending on pensions in Spain’, which the Ministry published in October. In it, the increases in the lowest pensions in the system are projected for the next four years, as agreed in the last pension reform.
According to the Executive’s estimates, the minimum contributory retirement pension for those aged 65 or over with a dependent spouse would go from 13,527 euros per year in 2023 (966 euros per month in 14 payments) to 16,472 euros per year (1,177 euros per month). in 2027, almost 22% more.
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 agreed in the pension reform to establish a goal for these benefits related to the poverty line, so that these lower pensions gradually move towards this reference.
Still waiting for the IMV increase
The Ministry of Social Security is also responsible for another key increase for many families in poverty: the increase in the minimum vital income (IMV).
Again, the Ministry headed by Elma Saiz explains that the figure is not closed at this time, but if the law that regulates the state minimum income is used, it is established that the IMV will be revalued each year like non-contributory pensions. That is, the forecast points to that 6.8%.
In any case, we will have to 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 initially it was an increase for three months, the increase was extended and was also maintained in 2023.
On the other hand, we will also have to see what the so-called “childhood aid supplement” looks like in 2024, the monthly aid per child for low-income families, but that exceed the IMV income thresholds (up to three times more). In 2023, the amounts have been, for each child:
- Children under three years old: 115 euros per month.
- Over three years old and under six years old: 80.50 euros.
- Over six years old and under 18 years old: 57.50 euros.