Pensions
Business 02/07/2021

Escrivá admits he made a mistake on baby boomer pensions: "I didn't have my best day yesterday"

Social Security Minister assures that he was only thinking out loud

2 min
The Minister of Inclusion, Social Security and Migration, José Luis Escrivá.

The Social Security Minister, José Luis Escrivá, has taken 24 hours to admit that he was wrong in the statements he made on Thursday about the pensions of the baby boomer generation. While yesterday he assured that this generation born between the 50s and mid-70s would have to choose between collecting a lower pension or working more years, this Friday he has hastened to correct his own words. "Yesterday I did not have my best day", he admitted during the press conference to assess the unemployment data for June. "[My words] were misunderstood, I was thinking out loud", he added.

He has also insisted that yesterday, when the pact of the first block of the pension reform was signed between the State and the social agents, it was a day to highlight this first agreement on pensions in a decade, a reform that involves guaranteeing the purchasing power of current and future pensioners and which repeals the controversial sustainability factor (the one that collected that the new pensions would be adjusted downwards if life expectancy increased) that would have meant a pensions' cut from 2023 onwards, which is the year in which it had to start being applied. "I did not adequately convey this certainty", acknowledged the minister, who insisted that with the new pension reform "the uncertainties of the 2013 reform are eliminated and purchasing power is permanently assured".

The mechanism will not be applied until 2027

According to the new pact signed, the sustainability factor will be replaced by a new intergenerational equity mechanism that has already been included in the first block of the reform but has yet to be defined with the social partners and will not be applied until 2027. This new mechanism is the one that Escrivá said yesterday would include the controversial choice on pensions for baby boomers: either work more years or collect more pension.

In fact, the Spanish government and social partners have months to negotiate the fine print of the mechanism, since they have set a deadline on 15 November. In this sense, Escrivá has already advanced that they will soon begin to exchange opinions with the social partners and then negotiations will begin.

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