In order to have pensions that provide a decent standard of living, we - unions, business associations and the government - agreed, in July 2021, on a first phase of transformation of the system to ensure its sufficiency, aware of how relevant is the formula used to the calculation of the initial pension as the one applied for updating. We were all aware that the revaluation of amounts and coverage together with the prospects for the aging of the population - both due to the lengthening of life expectancy and the retirement of the baby boom - is going to mean a sharp increase in public spending. To protect the system and guarantee its sustainability, we forced ourselves to increase income.
In this second part we establish a new financial structure, endorsed by the European authorities, resistant, sufficient and durable that increases collection, via contributions, to ensure the payment of more and better pensions for the next 27 years. We prevent an economic imbalance from occurring, which is often used as an argument to sow interested uncertainties about our social protection system. The agreement supposes the fulfillment of the milestone established in component 30 of the Recovery plan, which allows a fourth transfer of funds that will end up supporting Spanish companies, despite their decline.
The pact, consistent with the commitments acquired in 2021, ties the update of the maximum bases to the increase in pensions. Its very slow increase -1.2% per year- over a quarter of a century will not have a negative effect on high-paid employment, the only ones affected by the measure. The agreement also designs a solidarity quota on salary perceptions that do not contribute to social security, in a much lower percentage than that of the lowest incomes and with a moderate deployment until 2045. This corrects, in part, a discriminatory factor of our contribution system and brings us closer to the rest of the European countries, ensuring its sustainability without the need to resort to the tax system. The agreement guarantees that pensions are financed without cutting rights.
Transcendent is the protection of all minimum pensions, including those for widowhood, in a form and amount similar to the SMI. That is the reason, thanks to union insistence, to establish an indicator that will prevent minimum income recipients from falling below the poverty line. The gender gap is also being combated, increasing the coverage of gaps in women's professional careers and increasing the amount of the current supplement. The text includes improvements for people in discontinuous practices, autonomous or permanent.
We can be proud because this agreement guarantees the provision of Social Security for several generations.