June 21, 2021

Montero assures that the pension reform sent to Brussels finally does not extend the calculation period to 35 years


The Government spokesperson and Finance Minister, María Jesús Montero, assured this Tuesday that the Executive sent to Brussels yesterday, Monday, in the afternoon the two ‘files’ related to the labor reform and pensions in relation to the European Plan of recovery from the pandemic. Finally, Montero explained, the latest draft sent to the European Commission does not include the extension to 35 years of the pension calculation period. The measure was in previous documents and faced the two parties that make up the Government, according to government sources explained to elDiario.es.

How extending the calculation to 35 years of contributions affects the pension: cuts in general, improvements for the unemployed and harmful for women

How it affects the pension to extend the calculation to 35 years of contributions: cut in general, improvements for the unemployed and harmful for women

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To questions from this medium at the press conference after the Council of Ministers, María Jesús Montero replied that the latest draft sent to Brussels on the pension reform “does not contain any type of alteration with respect to what currently exists” on the calculation of pensions.

In other words, the Executive has decided not to include the proposal to extend it to 35 years, as was being debated internally. With current legislation, that period will reach 25 years when the pension reform agreed in 2011 is fully implemented. In 2021, 24 years are taken as reference.

This Tuesday afternoon, the Executive has summoned the social agents to a meeting on the reforms that it has sent to Brussels, after this Monday he barely detailed them in a first meeting with union and employer leaders. The unions demanded from the Executive the documentation sent to the Commission, to know in what terms Spain was committed to the EU on these issues, so they hope to have access to it at the meeting this afternoon, according to union sources.

Frontal opposition of United We Can

The proposal to extend the years that are taken into account to calculate the pension, advanced by El Mundo In mid-December, it generated a strong rejection within the Government, by the ministers of United We Can, who called it a “cut” in pensions. But it was also, on the part of the unions, who warned that the measure was not part of the recommendations recently approved by the Toledo Pact.

Government sources explained to elDiario.es that the measure proposed by Minister José Luis Escrivá was aimed at justify in Brussels other reforms that increased pension spending, such as the revaluation mechanism based on the CPI that would replace Rajoy’s 0.25% formula. Nadia Calviño acknowledged that the debate on the extension of the calculation period was open in the Government and mentioned the possibility of allowing some years to be excluded by the workers.

The minister responsible for the pension reform, José Luis Escrivá, has maintained caution so far in his responses on this issue, in which he referred to the still open negotiations of social dialogue, in which the measure has not been raised within of the Government’s plan to reform pensions. Until yesterday, Monday, when Escrivá revealed in an interview in El Periódico his plans to reform pension legislation in two phases this year, a first one that it intends to bring to Parliament in the first quarter of the year and a second block of measures that it foreseeably frames in the second half of the year.

In this second phase of changes, the minister acknowledged that the possible extension of the pension calculation period will be addressed, among many other measures, and assured that his team still has to make calculations in this regard. The minister denied having proposed in the Delegate Committee for Economic Affairs in the middle of last month the increase of this period to 35 years, as other government sources claim.

Members of the United We Can Government, such as Vice President Pablo Iglesias and Minister Yolanda Díaz, had warned that the deputies of their formation would not support in Congress the extension of the counting period to 35 years.

The dismantling of the labor reform towards Brussels

María Jesús Montero has also referred to the ‘file’ on labor market reforms that has been sent to the Community Executive. After intense negotiation within the Government between the two “souls” of the Executive, both reached an agreement in the text sent to Brussels, in which they understand that the dismantling of the 2012 PP labor reform is included, that the coalition included in his government agreement.

Another important source of tension is being buried – at least for the moment – within the Council of Ministers. The discussion on the promised repeal of the labor reform has counted in recent months with voices such as that of Vice President Calviño, little in favor of this issue and who came to cross out “absurd and counterproductive” reopen the debate at this time of pandemic, and the Minister of Labor, Yolanda Díaz, who insists that the coalition agreement must be fulfilled. Díaz is committed to gradually dismantling the labor legislation of the PP Government, in the context of reforms of labor regulations demanded by Brussels, such as excessive temporality and precariousness.

The minister spokesperson stated on Tuesday that the reforms transferred to Europe “contain the general elements that inspire the labor reform, with all the most damaging elements”, which the coalition government included “in the investiture agreement of the president.” The measures will try to combat “one of the great evils of the labor market”, such as excessive temporality, added Montero.

From now on, the Minister of Finance also pointed out, “a process of dialogue” and exchange is being opened in Europe on these files, which Montero has recalled that it will be necessary to “reconcile” with dialogue with social agents. The unions CCOO and UGT have called protests for next February 11 to urge the Executive to set a date for the negotiation on the labor reform and to increase the minimum interprofessional salary.

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