Pensions and SMI: the economic cards that Sánchez can play in the campaign

MadridFor days now, pensions and the minimum interprofessional wage (SMI) have come into play in the run-up to the 29-N election campaign. First, Vox questioned the sustainability of the pension system, and this week the PP got itself into a muddle with the future rise in benefits and the system's public model. Meanwhile, Pedro Sánchez's executive is positioning itself as the sole guarantor of both. In fact, they are two of the economic cards it does not hesitate to play.

"Our intention is, of course, for the pension increase to be approved before the end of the year. I am perplexed by the voices from the PP and Vox who say they will cut pensions or say that the system is about to collapse," said Pedro Sánchez this Thursday, in an address to the media from Brussels.

The first vice president and Minister of Economy, Carlos Cuerpo, has also defended that it is "perfectly" possible to approve the pension increase after the elections, even though the Spanish government will already be in a caretaker capacity. Regarding the SMI, he has opened the door for the 2027 increase to be approved before 29-N.

Minimum wage: pending the experts

The second vice president and Minister of Labor, Yolanda Díaz, has asked the group of minimum wage experts to prepare a proposal for an increase that, among other things, takes inflation into account. Cuerpo said in an interview with TVE that the approval of the new SMI will depend, precisely, on how the experts' work progresses. However, he said that to "reduce uncertainty" it would be "advisable to agree on and announce" the raise before November 29th. Currently, the SMI stands at 1,221 gross euros per month in 14 payments. The majority unions, CCOO and the UGT, are already pushing for a 7% raise.

Pensions: a raise with a caretaker government?

Regarding pensions, their revaluation with inflation is set by law –it was one of the changes of the great reform of Pedro Sánchez's government last term–. How? When the inflation for the month of November is confirmed (it will be in mid-December) of this year, the average will be calculated from the month of December of the previous year (in this case 2025), and this must be the increase. As a result of this calendar, Cuerpo himself has anticipated that the rise would take place with a government already in an acting capacity.

In his view, the update of pensions would "perfectly" comply with the requirements of "urgent necessity and general interest" that justify the approval of a royal decree-law by an acting government. Although it is possible, it is an exceptional and limited matter.

"This update will be done. The royal decree-law for the update can go the week after the elections [of 29-N], because even if it is in an acting capacity it can be approved [in the council of ministers], and then it must be approved by the permanent deputation [of Congress]", explained the minister, who defended it as a way to provide peace of mind to pensioners.