Unions and government agree that bank pensioners will receive half of their pensions in the coming months

Bank pensioners from private bank pension funds will receive an amount equivalent to half of their pension in the coming months, according to a memorandum signed this Friday at the Ministry of Finance.

More than 50,000 retirees are at stake, UGT general secretary Mario Murao told the press after the signing of an agreement between the government, banks and UGT banking unions.

Secretary of State for Taxation Nuno Santos Felix said the measure would cost the state about 40 million euros.

Last October, as part of an inflation-fighting family support package, the government paid an exceptional allowance to pensioners (retired from the Social Security and Caixa Geral de Aposentação) equivalent to about half of a pension. However, the payments did not include bank employees, who receive retirement pensions exclusively from the pension funds of banks, which caused opposition from the unions.

Today at the Ministry of Finance in Lisbon, the government, the Portuguese Association of Banks (APB) and the UGT banking unions signed an agreement that ensures that bank pensioners whose pensions are paid by the banks’ pension funds will receive the equivalent of half the pension before the end of the first semester, with the money being advanced pension funds of banks, and then paid to them by the state.

According to the secretary of state, the government has the right to legislate on this issue without having to go to parliament, and the money will come from the state budget.

“Just like the allowance paid to other pensioners was paid from the general state budget, it will also be financed from the general state budget, the difference here is that the payment is made by pension funds, because they who have financial relations directly with these pensioners” Felix Santos said.

When asked about the possibility of the same problem for pensioners from other pension funds, a government official said that this is the case for bank pension funds due to their characteristics: “On the one hand, this is a sector in which the transition from pension funds, whether it be for social security, and for Caixa Geral de Aposentação, we have the recent example of the Caixa Geral de Depósitos fund, and on the other hand, these are pension funds that, as a rule, did not supplement, but replaced social security, ”he explained.

The secretary of state said that the legislative draft would consult with insurance supervisors and that there was “no risk of decapitalization” of pension funds for pension funds, since the state was obliged to reimburse all the money that the funds would be paid “within a reasonable time.”

The general secretary of the UGT and the president of the SBN, the Union of Financial Sector Workers, believed in press statements that this decision “removes the violation of the principle of equality” (a violation that, in his opinion, the government committed by excluding pensioners from bank pensions) and that this agreement demonstrates the power of “negotiation and dialogue” between trade unions, banks and government.

As in the previous year, an additional support of 50% of the pension is provided to pensioners with pensions below 12 social assistance indices (IAS), about 5,300 euros. The amount is taxed in the IRS separately from the monthly pension.

In the case of these pensioners, who received the €125 support (allocated by the government also in October for workers with incomes up to €2,700 gross per month), this amount will be deducted from half of the pension, the Secretary of State said.

In the afternoon, the same memorandum will be signed with the National Union of Bankers and Technicians (SNQTB).

The payment of the equivalent of half a pension in October caused controversy as it came with the government’s decision to renew pensions in 2023 at a rate lower than the result of the statutory formula.