From January 1, the maximum pension will be increased

Greek pensioners, who currently receive a maximum allowable pension of 4608 euros, will receive more from 2023, as this maximum, the ceiling, is set on the basis of the basic national pension, which will also increase by at least 7%, reaching 411 euros.

According to the Ministry of Labor, from 1/1/2023 it is planned to raise the upper limit of the pension by 7%, above which the so-called. “circumcision”, which will eventually raise the upper limit of pensions to 4932 euros.

The Ministry of Labor notes that, pending a final decision on the increase in pensions, which will affect 1,682,116 pensioners of all funds and regardless of the type of pension they receive – old age, widowhood, disability (out of a total of 2.4 million pensioners) for those who has already retired, the increase will apply to both the national and the funded part of the pension. In practice, this means that, for example, with a 7% increase, the national pension will be €411 in 2023, while today it is €384. Accordingly, the accumulative part of the old-age pension will increase in the same way.

At the same time, the increase in the national pension will “entail” a number of variables that are “tied” to the national pension: the ceiling for basic pensions, thresholds for death pensions and the allowance for uninsured older people, which will be adjusted upwards. Thus, the richest pensioners will benefit from the increase – for them the ceiling is set at 12 times the national pension.

During the last period, there has been particular concern about how the increase for those who become retirees in 2023 will be calculated, as concerns have been raised about a wave of mass retirements in 2022 so that those who are already eligible to retire will be able to receive a full increase in both national and funded pensions. Those who become retirees in 2023 will also receive a pay raise equivalent to the 7% increase that active retirees will receive from 1/1/2023, according to the Labor Department. The difference between the increase in pensions for working pensioners and those who will become a pensioner from 1/1/2023 is that they are calculated using a different mechanism.

The first mechanism applies to pensions already granted: each year from 1/1/2023, the total amount of pensions will increase by a factor based on the sum of the annual rate of change of GDP plus the rate of change of the average annual general consumer price index for the previous year, divided by 2!.

The second concerns pensions awarded at any time in the future: the funded part of the pension is calculated on the basis of retirement earnings. Retirement earnings are adjusted based on changes in the average overall consumer price index. In any case, the amount of the pension is adjusted to the year preceding the year of retirement.

Thus, according to the estimates of the Ministry of Labor, the pensions that will be issued in 2023 will be increased, since the national pension will increase by, for example, 7%, and pension earnings will be multiplied and increased by the 2022 inflation rate.

Higher income for 2,472,939 pensioners

An increase of 7% will be seen by 1,682,116 pensioners of all funds and regardless of the type of pension they receive (old age, widowhood, disability). Of these, 80%-85% will receive a full 7% raise, and the vast majority of the rest will receive a raise of more than 6.5%, depending on the size of their personal difference.

With regard to the 931,631 pensioners with a large personal difference, 88% of them will also receive a salary increase through the abolition of the special solidarity contribution (525,456 beneficiaries with a large personal difference) and the payment of a special allowance of 250 euros (265,367 beneficiaries). At the same time, they will see a significant reduction in their personal differential.

Data analysis shows that:

• At least one increase will be seen by 2,472,939 pensioners (due to a 7% increase or the abolition of the solidarity contribution or the payment of an allowance of 250 euros).
• 1,273,440 pensioners will have a double increase (as a result of a combination of a 7% increase, the abolition of the solidarity contribution or the payment of an exceptional financial aid of 250 euros).
• 97,415 pensioners will receive a triple increase (as a result of a combination of a 7% increase, the abolition of the solidarity contribution or the payment of an exceptional financial assistance of 250 euros, and the implementation of the 4th annual increase of the law, according to the current pension system (Vrutsis Law).

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