July 10, 2020

Freelancers and workers with ERTE will rescue their pension plan at no cost



The Government will allow to rescue the pension plans without having to pay the Treasury those savers who suffer a Temporary Employment Regulation File (Erte) and the self-employed who must cease their activity due to the coronavirus pandemic.

It is one of the more than 50 measures included in a Royal Decree Law that the Council of Ministers approved on Tuesday and that seeks to reinforce the so-called social shield against the coronavirus, according to Executive sources.

Until now, pension plans could only be rescued at no cost to the saver in a short list of cases such as retirement, death and the situation of dependency or permanent disability, being an illiquid product.

This and other decisions announced today, such as the moratorium on rents for vulnerable families, will help alleviate the economic hardship caused by the stoppage of economic activity caused by the spread of the coronavirus for many households.

The liquidity of the pension plans is restricted for a reason, explain the experts consulted by Efe, which is to prevent the participants from deviating from the main purpose of these savings vehicles: the supplementary pension provision.

“To promote this saving and compensate for this restriction on availability, pension plans are fiscally incentivized at the time of the contribution, with up to a maximum of 8,000 euros per year,” added the sources.

Group or employment pension plans are a minority in Spain, with only 1.9 million members, although they offer more profitability than individual plans, which are much more widespread.

At the end of 2019, according to Inverco data, in Spain there were 9.5 million open pension plans: with 7.5 million individual participants, totaling 79,850 million investment, and 1.98 million in employment plans, with an equity of 35,170 million.

In net terms, some 8 million Spaniards participate in a plan since there are people who have more than one.

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