The PSD Minister of Labor announces a 40% increase in pensions from September 1, 2024, amid the electoral campaign for the parliamentary and presidential elections.

Labour and Social Solidarity Minister Simona Bucura-Oprescu announced at Monday’s meeting of the Chamber of Deputies’ Labour Committee that the new legislative initiative on pensions will be approved by the Executive on 9 November and will be adopted by the Legislature by 20 November, News.ro reports. Bucura Oprescu is announcing a 40% increase in pensions from 1 September 2024, in the middle of the election campaign for next year’s elections.

Simona Bucura Oprescu later told Antena 3 that the monthly pension expenditure will increase from 9.6 billion lei at present to 11.32 billion lei from 1 January 2024 (with inflation indexation), and from September 2024 the monthly pension expenditure will be 13.8 billion lei. In other words, from September 2024 monthly pension expenditure will be 4.2 billion lei higher than now.

„Regarding the impact, for implementation from 1 September, a budget envelope of 13.84 billion lei is needed, i.e. 55.36 billion lei for the four months from September to December,” she added.

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„The draft pension law is in transparency until 9 November. Our ambition is that on 9 November it will be adopted in the Government, after which we will come before you, so that together we can have an accelerated parliamentary path, so that by 20 November we can finalize the parliamentary calendar for the reform of the public pension system, an important law for Romanians. As regards the impact, for implementation from 1 September (2024 – editor’s note) a budget envelope of 13.84 billion lei is needed, i.e. 55.36 billion lei for the 4 months from September to December (2024 – editor’s note). Maybe there will be pensions that will increase by 1%, maybe there will be pensions that will increase by 80%, but our calculations show that we will have an average pension increase of 40%”, said the Labour Minister.

She also said that this pension law will apply from the beginning of January next year and then the pension point will be 2,032 lei.

„For granting the 13.8% increase, which also complies with the current conditions of the law on the Swiss formula, with the inflation rate plus 50% of the real increase in average gross earnings, for the period to which we refer this was negative, which means that we remain with 13.8% increase in the pension point. This means that if we now have a pension point of 1,785, we will have a pension point of 2,032 from 1 January. On „why do we apply from 1 September?”, the answer is very simple. We are at an advanced stage of digitisation of pension files, more than four million files are already digitised, after the adoption of the law by the Parliament we need a period in which the rules for the implementation of the law will be drafted and approved. After the implementing rules, we need a period for both the acquisition, the procedure and the software of the system to allow the new law to be applied. Then we need a period during which colleagues from the territorial pension offices will actually apply the new law and, based on the data in the system, recalculate all the pensions of Romanians, send them the decisions, and then from 1 September every Romanian will receive their new pension coupon”, said Simona Bucura-Oprescu.

The PSD minister added that the bill includes provisions on pensions and the minimum social allowance and added that the legislative initiative encourages contributory work.

„Thanks to this formula, the 1,200,000 Romanians who receive the minimum social allowance will be in a favourable situation where they will have, after the application of the formula, 87.4% more, i.e. 1,960 lei, compared to 1,825 lei, if they worked for 35 years on the minimum wage. In other words, this formula, which encourages work with stability points, will lead to the adequacy of small pensions and will increase pensions, according to our calculations, by an average of 40%,” Bucura-Oprescu explained.

Source: News.ro