Pension reform

The Cabinet has approved a draft law on pension reform delaying the legal retirement age to 67 years after the approval of the advisory bodies to the draft agreed between the Government and the social partners within the social and economic pact.

The bill responds to the original content approved the draft agreed with the social partners, while incorporating between 70% and 80% of the recommendations of the report of the Economic and Social Council (CES).

After the unions threatened to strike if a new decision was made to delay retirement beyond the age of 65 and after several meetings, the social partners and the government managed to bring two positions and seal on February agreement in this matter , also some indications about collective bargaining, employment policies and energy.

In particular, the pension reform is scheduled to come into effect in 2013 and raise the retirement age over a period of 15 years to 67 years, so the changes are completed in 2017.

However, you can retire at 65 years proves that 38 years and 6 months traded, while the retirement age 67 will continue to need, as now, only 15 years minimum price to have access.

As another novelty introduced the requirement to have a career of 37 years of contribution to access to receive the maximum pension, compared with 35 today.

The implementation of the new age requirements and contribution period becomes gradually from 2013 until 2027 due to the following table:

The reform also expands from 15 to 25 years the period of calculation of pensions, ie the calculation basis of the calculation, applying the new formula gradually from 1 January 2013 until 1 January 2022 .

Regarding the amount of the pension contributions set proportionally years, so 15 years of contributions will be entitled to 50% and 37 years at 100%.

Establishes two types of early retirement: a, from 61 years on the job when the termination occurred as a result of a crisis or closing the business and the other from 63 years for voluntary termination at work; in both cases applied according to different reduction coefficients have contributed roughly 38 years and 6 months.

Also, it remains to retirement at 60 or policyholders who have contributed to the general Social Security as an employee before 1 January 1967.

Also be modified partial retirement age to access without replacement contract with another worker, also, 65 or 67 years, depending on the contribution periods required in another case and gradually from 2013 to 2027 and access them with relief contract to replace those retiring, 61.

The government estimates that 40% of workers retire with 67 years, another 40% in 65 years and the remaining 20% ​​do so at lower ages, occupations develop painful or to be disabled. The reform also envisages that women and men can tell, only for the purpose of retirement from 2013, with 116 months of contributions for a child up to two years if they had to stop working to care for it.

Meanwhile, the reform that provides paid training programs, such as grants, give rise to a contribution of voluntary nature, which is equivalent to which is provided in the training contracts -50 euros provided by the firm Special agreements with the Social Security.

Finally, keep in mind that the law will take effect January 1, 2013 but will continue to apply the current regulations before this date people who have terminated their employment prior to 25 March 2011, at people affected by Downsizing Jobs for suspension or termination approved before 25 March 2011 and who have been granted partial retirement pension before 25 March 2011.