The Toledo Pact agrees on new pension cutbacks

Nov 04, 2020
ELA warns that the route taken by previous governments is being consolidated; the CPI is not completely guaranteed and the working life is to be extended, shortening retirement.

Another pension reform is approaching; one that will entail even more cutbacks. This is the conclusion reached by ELA from the document of the Toledo Pact that includes 20 recommendations, approved on the 27th of October and that will be brought before the plenary session of the Congress (with the consent of PSOE and Podemos).

This proposal does not specify that the revaluation guarantees the spending power; they intend to cut back the amount included in new pensions; limiting early retirement; cutting back widow’s pensions; and above all, the fact that there is not even one mention of any reversal of previous reforms stands out. Faced with this reality, ELA considers the debate on the distribution of wealth to be urgent, centring on the level of income we want to guarantee for pensioners.

ELA affirms that, in spite of the fact that the Government talks about its commitment to maintaining spending power, the agreed upon text is not at all clear. “There is no guarantee that the real wish is to guarantee this revaluation according to the PCI will be guaranteed from now onwards by law; its design will be included in the reform that is agreed upon with the social agents in the social dialogue.”

The document also intends cutting back the amount included in the new pensions, by extending the years of contribution in order to be able to calculate the pension. Additionally, the idea of promoting work after retirement age is becoming increasingly popular, strengthening the incentives for delaying it and combining it to extend professional careers. “This undermines the possibilities of young people and/or the unemployed to gain access to jobs.”

The document also talks about giving widow’s pensions only in cases of 65 years of age or over, according to the financial situation of the family unit of the person benefitting from the pension.

For ELA, the fact that there is no mention of any reversal of the previous reforms particularly stands out, neither with regard to reversing the delay in the retirement age or to eliminating the sustainability factor, while the situation is highly concerning:

  • One of every 4 people is a pensioner and the average pension amount is low: 1,260 euros in the Autonomous Community of the Basque Country and 1,167 in Navarra.

  • The gender gap is obvious. The average pension for women is just 964 euros in the ACBC and 896 in Navarra, almost 40% less than that of men (1,575 euros in the ACBC and 1,439 in Navarra).

ELA’s proposals:

  • To reject the Toledo Pact and its philosophy and consequently, all the reforms and cutbacks that arise from it and from evil called social dialogue. The leading role of the pensioners’ movement must be acknowledged as a representative spokesperson.

  • To completely reverse the cutbacks of 2011 and 2013 (amount included in new pensions, delay in retirement, up-dating of pensions, eliminating the sustainability factor…).

  • To create quality employment and raise salaries above the PCI.

  • To approve the contents of the Popular Initiative against poverty and social exclusion (Social Rights Charter of Euskal Herria), the processing of which was rejected in the Basque and Navarra Parliaments.

  • A minimum pension of 1,080 euros, according to the criteria of the European Social Charter, which sets a Minimum Salary equivalent to at least 60% of the average salary.

  • To not restrict the funding of the pensions to social contributions.

  • To increase the expenditure in pensions, reforming the fiscal policy and pursuing fraud. We are at the tail end for fiscal pressure in Europe (the differential with respect to the European average is 8,000 million euros per year in HEH), and at the head in fiscal fraud. However, taxes have been reduced on high incomes, on capital and on companies.

  • To eliminate business bonuses, because they have no positive effect on employment.

  • To promote the public pension system.

  • To decide on the system as a whole in Euskal Herria.

  • The institutions in the ACBC and Navarra must guarantee suitable income for both current and future pensioners, complementing the loss of income due to the cutbacks made by the Spanish government and guaranteeing a minimum pension of 1,080 euros.

To achieve these goals, ELA considers social mobilisation to be essential. Therefore, it will continue to be in the streets.

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