Salaries and pensions are moving along different paths. The divergence is "absolutely strategic" for the evolution of the economy and social cohesion, assures Jordi Garcia, professor of labor law at the University of Barcelona (UB). This August, retirees have collected an average of 1,574.9 euros, 4.5% more than a year ago, according to the Social Security. However, prices in July rose by 3.5% compared to 2025, while awaiting to know how much the cost of living has increased this month (based on data from the CPI, the consumer price index, published by the INE).

The aging of the population has led the Spanish government to seek solutions to address pensions. Therefore, for years, Madrid has been seeking to promote a hybrid model that allows people to begin receiving their pension while extending their working life. In other words, a system that allows people to work and be a pensioner simultaneously. After numerous failures, a new series of regulatory changes will come into effect starting April 1st to encourage these options.

One cold, one hot. That's the conclusion drawn from the first major examination of the pension reform that the Spanish government launched in 2020. This Monday, the Fiscal Authority (AIREF) published the results of the acid test—the agency is mandated to evaluate the measures every three years—and, while Cristina Herrero confirmed compliance with the "spending rule" of the AIREF system, in a press conference. However, the Spanish government sees AIREF's conclusions as an endorsement of all the approved changes. In fact, the Ministry of Social Security speaks of the reform's "success." Why do they have such different opinions?

As of January 1, 2022, pensioners will see their contributory pensions go up by 2.5% as a result of the increasing CPI. This raise is the result of the new revaluation formula included in the pension reform bill, which takes into account average year-on-year inflation of the previous 12 months, that is, from December of last year to November of this year. This was agreed by the Spanish government, trade unions and employers in the summer, leaving behind the 0.25% maximum the PP's reform approved. In addition, the agreement states that, in case of negative inflation, pensioners will not see their income reduced, but it will remain the same.

The Spanish government has announced this Monday an agreement with trade unions to increase Social Security contributions by 0.6% for 10 years as an exceptional measure to be able to pay the pensions of the so called baby boomers (those born between the late 50s and late 70s). Business associations CEOE and Cepyme have decided to dissociate themselves from the agreement and walked away from the table without presenting an alternative. In a statement they have simply stated that the measure "is insufficient, does not guarantee the balance of the system and additional measures will be needed in the future to ensure its sustainability".