RETA: a reform with unfinished business
In 2023, a reform was launched that overhauled the social security contribution system for the self-employed (RETA). This modification was based on the report of the Toledo Pact commission. The reasons were clear: the average RETA pension was significantly lower than that of the general system—37.4% lower in Catalonia in 2020—and there was a high dependence on minimum supplements (34% in the RETA, compared to 20% in the general system). All of this occurred within a model that allowed workers to freely choose their contribution base, leading more than 80% of the self-employed to contribute at the minimum rate. The 2023 reform introduced a profound conceptual change: contributions would be adjusted according to business results. The objective was threefold: to improve benefits, reduce the need for supplements, and increase Social Security revenue. The transformation was planned over nine years, with an initial phase (2023-2025) focused on testing the new model.
This initial stage established an annual table of fifteen brackets based on net income, contribution bases, and contributions. Net income determines a minimum and maximum contribution base from which the self-employed worker can choose within each bracket; this chosen base then sets the monthly contribution. The system works like income tax prepayments: monthly contributions and annual adjustments. Initial data shows that half of the self-employed workers have not had to make any adjustments; 2.7 out of 10 had overpaid their contributions and 2.4 out of 10 had underpaid.
Expectations of increased contributions were partially met: the CTESC report on self-employment in 2024 indicates that 6.5 out of every 10 self-employed workers contribute between the minimum base (€951) and €1,426, and those contributing at the minimum rate are 1.8 out of every 1.2 out of every 1.2 out of every 1. This represents an increase in the number of people returning to paying the minimum amount.
The first period of the reform ends in 2025. The initial proposal for contribution tables for 2026-2028 anticipated substantial increases in all brackets, but this was immediately rejected by the self-employed community. The Ministry revised this proposal with a table proposal only for 2026: freezing the minimum contribution bases for the lower brackets and increases of between 1% and 2.5% for the remaining brackets. The debate has focused primarily on the contribution amount, but this is only the tip of the iceberg. Beneath this factor lies the contribution base and the conditions for accessing and using benefits. These are the elements that protect individuals if they become ill, have an accident, take leave for childbirth or childcare, close their business, or retire. It is in these areas that the reform is still insufficient. Unemployment benefits are a good example. Despite the improvements in 2023, six out of ten applications are rejected, mainly due to the difficulty of proving cessation of activity. What is objectively verifiable in salaried work becomes blurred in self-employment, where the line between closing down and surviving is often minimal. Sick leave also highlights the limitations of the system. The self-employed take far fewer sick leaves than salaried workers – 11.6 per thousand people per month, compared to 51.2 – but when they do, they last much longer: an average of 82 days, compared to 25.8. This isn't because their health is worse, but because they only request sick leave when the situation becomes untenable. The 2024 study by Pimec Autónomos confirms this: being on sick leave has immediate economic consequences and impacts on business continuity. Added to this is a critical factor: during the first two months, the self-employed must continue paying their full social security contributions, at a time when income is falling. The 2023 reform was a starting point. But adjusting contributions or redefining income brackets is not enough. Working for oneself involves risk, volatility, financial liability, and a direct dependence between the individual, the business, and their health. Social protection must adapt to this reality, coupled with taxation consistent with net income and policies that boost demand, so that businesses not only survive but also thrive.
On November 24th, the 3rd Night of the Self-Employed will be held, organized by Pimec Autónomos, a recognition of a group that, despite not yet having a system that adequately protects and supports them, opens their doors every day and generates economic activity.
The reform of the Special Regime for Self-Employed Workers (RETA) has outstanding issues. Data from the first stage show progress but also limitations that affect the social protection of the self-employed. 2026 should be a year of evaluation and a turning point to provide the system with a clearer, fairer, and more adapted approach to self-employment.