June 18, 2021

Rebellion against government plans for pensions and early retirement

The secretary general of UGT, Pepe Álvarez, has charged heavily against the Government’s proposals to ensure the sustainability of the pension system, expressed yesterday by the Minister of Inclusion, Social Security and Migration, José Luis Escrivá. Álvarez has demanded that the Government focus on job creation instead of proposing measures to tighten pre-retirement conditions. “Most people who retire before retirement age He doesn’t do it of his own accord, but because he has lost his job and he has no chance to continue working, ”recalled the union leader. “You have to create employment for people over 55 who have been unemployed, so as not to force them to retire early at age 61,” he added. As UGT said in a statement, Álvarez made these statements to questions from journalists about the appearance yesterday at the Congress of the Minister of Inclusion, Social Security and Migration, José Luis Escrivá, in the Toledo Pact Commission. “With the level of unemployment there is it is an insult to intelligence to propose incentives to extend the retirement age”, He stressed, after stating that Spain is not a country to extend the retirement age, but that there is a“ very large ”problem in relation to youth employment and the lack of opportunities for young people to find a job. Along these lines, he stressed that he will propose to Escrivá, when the social dialogue table is established, to promote relief contract in all sectors, so that young people can join the world of work. Regarding pensions, he pointed out that “The mission of the minister is public pensions”, since, from his point of view, the private system is complementary and prioritize it or not, “it has to do with fiscal policies and see what it poses.” However, he sees “very well” that the tax credits to these plans are not maintained, since “the one who takes advantage of taxation in the pension plans is not the workers with an average level of purchasing power, but people who have a very high purchasing level ”.

Pension plan managers criticize the punishment of individual plans

Private pension plan managers also criticized the proposal to gradually transfer the deductions from individual plans to business plans. Thus, the CEO of Mapfre Iberia, José Manuel Inchausti, has applauded the Government’s announcement to encourage company pension plans, but does not understand that it is done at the cost of eliminating taxation favorable to individual pension plans, as he considers that both are complementary pillars necessary to promote private savings in Spain. This was stated during the presentation of the company’s strategy for this year, after being asked about the announcement of the Minister of Inclusion, Social Security and Migration, José Luis Escrivá, in his appearance before the Commission for monitoring and evaluating the agreements of the Toledo Pact the Congress. Inchausti has recognized that since the employment pension plans were launched, their development has been lower than expectations, so any measure aimed at encouraging them is “welcome” and “very good news.” “What we don’t understand very well is why it has to be done at the expense of private plans. We do not understand what it has to do to promote one thing with taking away strength from the other, because we understand that they are two completely complementary pillars, since the greater the private savings in Spain, the better, ”he said. In this sense, Inchausti believes that the right thing would be to promote employment pension plans and, in turn, individual pension plans, since both are “a solution to problems that are going to arise and that all media are going to be few to alleviate them ”, referring to public pensions. “The public pension system will always exist, but the amount of pensions will not be what it is today. It is a ‘gap’ that is going to be generated and there we do not understand why one of the elements we have to cover that ‘gap’ we now have to demonize it, because it has only brought benefits and the penalty is that it is not more developed ” , the CEO of Mapfre Iberia has apostilled.

For its part, KPMG believes that collective social security should have been boosted in Spain many years ago and that SMEs, which make up more than 80% of the Spanish business fabric, should not be left out of these incentives, while questioning that Tax incentives on individual savings are eliminated, which can weaken the social security system. Regarding the announcement of the minister to divert tax relief from individual plans to business plans, Álvaro Granado, head of Pensions at KPMG Abogados, has warned that “Eliminating tax incentives on individual savings may not be the best news for many citizens that are outside the scope of collective social security (self-employed workers, workers of companies with a small number of employees, etc.). “If we eliminate one of the three legs (Social Security, collective savings and individual savings) that will sustain future pensions, we may not have a complete and sufficient pension system, as long as the three pillars are and will be necessary to guarantee our pension ”, He has alerted.

In the same line has pronounced the president of Inverco, Ángel Martínez-Aldama. “We agree that the employment system must be promoted progressively. This is not against the plans of the individual system, but is aligned, “he said.” As the employment system increases its own coverage, then a deduction to the individual system will not have to be eliminated, but, simply, voluntarily, individuals will not do them, because they will already have employment coverage, ”he added.


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