Social Security is reducing the deficit to 11,192 million, the lowest since 2013

Social security red numbers fell sharply in 2021. The deficit narrowed more than expected last year and fell to 0.93% of GDP, to € 11.192 million, according to data released by the ministry of Jose Luis Eskriva this Thursday. This is the lowest deficit since 2013, which for the first time ever falls below 1% of GDP. Social Security emphasizes that this figure was lower than expected due to the sharp increase in social contribution income, as well as food for transfers from the state.

Thus, the social security reports as of December 31, 2021 presented a negative balance of 11,192 million euros, which “accelerates the reduction of the deficit compared to previous years.” The body deficit has been declining since 2016, but the decline is the largest in the last year.

“Both in absolute and relative terms, the year-end figure is lower than originally projected in the general budget, which estimated an imbalance of 1.2% of GDP,” Social Security recalled.

A sharp increase in income from donations

The ministry explains the improvement “mainly in the increase in social security contributions, which increased by more than 12,000 million (10%), which is twice as much as the 4.3% increase projected in the 2021 budget.”

In absolute terms, social security contributions amounted to € 131.990 million in 2021, driven primarily by an increase in employee contributions, the ministry said, ”which experienced an annual growth of 9.47% (10.460 million). Euros more).

If we look at its relationship with GDP, income from social contributions amounted to the equivalent of 11% of GDP, “which is the highest rate in history, which is 1.5 percentage points of GDP recorded in 2016.” Emphasizes the Ministry.

Transfers in social protection

In addition, Social Security received transfers of € 47.991 million, up 5.30% year-on-year. The most important point corresponds to the transfers received from state and autonomous bodies, which total 36,112.31 million (0.89% more), “the most representative being the one received to implement the first recommendation of the Toledo Pact.” They explain in the Ministry, for which the so-called “Inadequate expenses” that social security used to receive through social security contributions are paid in taxes.

These remittances also “financed the minimum subsistence income to a total of € 16.945 million,” Social Security indicated.

As for expenditures, here, as always, the largest (160,588 million) points correspond to pensions and contributions, with a 5.4% increase (€ 8,229 million more). “According to a detailed analysis of the contribution area, the costs of pensions (permanent disability, retirement, widowhood, orphanhood and family benefits) increase by 4.9% to € 138.459 million,” Social Security said in a statement.

As for temporary disability subsidies, total expenditures increased by 5.1% compared to the same period last year and reached 12 497 million euros. “The total cost of COVID-19 assimilated due to work-related illness due to work accident is € 1,677 million, which means greater protection for the worker and the company,” the ministry said.

Expenditures on childbirth and care benefits increased by 16% compared to the previous year and amounted to 3,499 million. The big increase is mainly due to the extension of the second parent’s leave, previously “maternity leave”, from January 1, 2021, from 12 to 16 weeks.

In addition, € 3.577 million was spent on minimum living income and family benefits, “62% more than the previous year”, in which the state minimum income barely started in June.