Pensions will increase by 9.7 percent next year. The cabinet decided this in the Council of Ministers on Wednesday. Only luxury retirees with a salary of 5,850 euros or more have to settle for a fixed amount of 568 euros per month. The senior representatives’ wish to prevent an impending loss of value for the coming pension cohort with a protection clause is also being fulfilled.
The cost of the package is 5.3 billion euros, as Minister of Social Affairs Johannes Rauch (Greens) explained. The general increase of 9.7 percent does not come as a surprise, as this value corresponds to inflation from August 2022 to July 2023, which always forms the basis for increasing pensions. This also increases the compensation allowance, bringing the minimum pensioners to 1,217 euros per month. This year it is 1100 euros.
Fight against “unwanted side effects”
The government made it clear in the middle of the summer that there would be no additional additions this year. Now the senior representatives are properly taken care of. This concerns an impending real pension loss, which, according to Rauch, is an “unwanted side effect” of inflation.
Protective clause is intended to prevent pension breaches
Contributions to the pension account are increased annually based on wage developments. Due to inflation, wages are currently rising more than in normal times. However, the average income development from the third to the second calendar year is always assumed. The high wage agreements would only have a positive effect on the pension account from 2025.
To prevent people who want to work from quickly retiring this year and not losing their pension, the government is now introducing a protection clause. This will only be worked out in parliament, but according to ÖVP club chairman August Wöginger it should be around six percent, which would not sufficiently upgrade the actual system.
The system for “normal times” must continue to exist
Whether a protection clause would be needed again next year remained unclear. Rauch wants to make this dependent on the development of inflation. Wöginger does not want to shake the system itself, as it has proven itself in ‘normal times’.
Source: Krone
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