In the Ministry of Inclusion and Social Security they have already gotten used to the idea that the last phase of the pension reform is for January, at least, and that the deadline set with Brussels will be breached in this way. Given the firm opposition of unions, employers, and even Podemos, especially with regard to extending the calculation period, it does not seem feasible to take it to the Council of Ministers on Tuesday.
In the ministry they point out that a delay is assumable, and they remember that the reform of the contribution of the self-employed was approved 20 days later than what was established with all normality. It is true that in Brussels they are not obsessed with dates, but they are demanding with the substance of what was promised. For example, they want to ensure the sustainability of the pension system, especially after the Government buried the mechanism designed by the PP to guarantee it.
This is where Escrivá makes his argument. According to his calculations, if pension spending currently accounts for 12% of GDP, with the changes that will be introduced it will reach 15.5% in 2050, when the baby boom generation has entered retirement. To correct this gap of 3.5 points, Escrivá plans to act on both income and expenses. Specifically, he foresees that the delay in the real retirement age, through penalties for early retirement and incentives to extend working life, would already cover 1.5 points.
To this would be added 1 additional point through the Intergenerational Equity Mechanism (MEI), an instrument that Brussels pressures to extend until 2050, something that the ministry implies that it will end up accepting. "It will be at the last minute," they point out from Inclusion. The rest would be covered with the extra income that the change in the contribution system of the self-employed will provide in the long term (0.6%) and with the uncapping of the maximum bases (0.5%)
These are numbers that Escrivá is capable of developing on any napkin he has at hand, but his proposals do not convince the social agents. In particular, the opposition is widespread regarding the extension of the computation period to calculate the pension. The ministry plans to go from the current 25 years to 30, but allowing the two worst years to be suppressed. And although Escrivá is willing to move from this initial position, the problem is that what is being questioned is the very principle of enlargement. “It is a very sensitive political matter”, they indicate from Podemos; "It is not necessary now, nor does it have parliamentary support," they add from the unions. Aware of the latter, Escrivá is maintaining contacts with political groups to prepare the ground for the approval of the reform when it reaches parliament.
However, first it has to clear the way within the government coalition itself. Podemos continues to express its opposition and we only have to remember the controversy that took place in November of last year between Pablo Iglesias and José Luis Escrivá over this extension of the calculation period. The minister ended up saying that “I don't understand the controversy. It seems to me like a summer snake that Pablo Iglesias launched a year ago and that comes out from time to time ”. For the moment, the opposition of Podemos remains, and they join unions and employers to request that this point of the reform be withdrawn.
One of the great arguments with which the ministry justifies this change is the adaptation of pensions to new professional careers, in which the old trend that the last years are the best is followed less and less; in addition to giving the option to correct the contribution gaps during the employment trajectory.
In any case, the dilemma is that, although the opposition to this modification is forceful, it is included in the objectives of the recovery plan to be met this year in order to aspire to the next disbursement of European funds. A delay is acceptable, but not approving it would penalize.
Another central element of the reform is the so-called uncapping of the maximum bases, to increase the contribution of the highest salaries. It is about raising the current limit from which contributions are no longer made, compensating it in due time with an increase in the pay that the retiree in question will receive. Here there is full disposition of the unions, but resounding rejection of the employer, who sees in it another increase in labor expenses, and who remember how they already have to accept the last increase included in the budgets, plus the 0.6% that will be introduced the MEI. Another repeated complaint from the employers is Escrivá's negotiating style, and the delay with which he presents his global proposals on the negotiating table. Rushing until the last minute to try to put pressure on us is not the formula, they complain from the CEOE.
