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HomePoliticsPensions are expected...

Pensions are expected to rise by 6.5% next year.

The lowest pensions are expected to rise by 6-6.5% next year, according to Expresso newspaper, based on a calculation formula that takes into account inflation and economic growth. But the exact amount of the increase will only be known at the end of November, when the inflation rate over the past 12 months becomes known.

The calculations therefore take into account the formula used in recent years, with the exception of 2022, when the government decided to reduce the increase. This year, the Prime Minister has already guaranteed that the rule, which takes into account inflation and economic indicators, will apply.

According to Expresso reports, pensions at twice the Index of Social Assistance (IAS) – currently €480.43 and which will also be updated in 2024 – will rise by 6-6.5%; between 2 and 6 IAS there will be an increase of 5.7% to 6.2%, and pensions above 6 IAS and up to 12 IAS will have an increase of 5% to 5.5%. Finally, pensions worth more than 12 IAS will not be increased.

So, roughly speaking, someone who receives a pension of 500 euros a month will receive an increase of approximately 32.50 euros from next January.

According to the formula, pensions were due to increase by 8.4% in January 2023, but the government decided to accelerate the increase by assigning a value corresponding to half the pension in October 2022. In January of this year, pensions were updated by 4.83%. After being heavily criticized, the executive ultimately decided on an extraordinary increase of 3.57% from July compared to December 2022, thus restoring the value to the current formula. In other words, overall pensions up to two times the IFRS amount were increased by 8.4%, and pensions from two to six times the IFRS amount increased by 8.06%. For pensions 6–12 times the IFRS value, the increase was 7.46%.

The updates will affect 2.7 million pensioners

The increase will cover a group of pensioners numbering about 2.7 million people, of whom about 650 thousand are from the Caixa Geral de Aposentações (CGA). Prime Minister António Costa has already guaranteed that next year there will be “no loss of purchasing power for pensioners” and has also assured that a formula will be applied for increases indexed to inflation.

Author: Raquel Oliveira
Source: CM Jornal

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