Pension update formula is to be maintained but will be studied

The Minister of Labor, Maria do Rosário Ramalho, said today that the pension update formula is to be maintained, but said it is the Government’s intention to study it throughout the legislature.

“The formula that exists is to be maintained”, said the minister, indicating that the Government has committed to studying this updating formula throughout the legislature, but without introducing changes yet.

Interviewed this Tuesday on RTP1’s Telejornal, the minister also said that, with regard to pensions, the area where the Government intends to make changes is in the lowest pensions, through the increase in the Solidarity Supplement for the Elderly – as stated in the government program.

“Portugal has a poverty problem, which is closely linked to age”, he said, noting that the “priority” is to work towards the lowest pensions.

The current formula for updating pensions takes into account the behavior of the Gross Domestic Product (GDP) and inflation, dictating differentiated increases depending on the value of pensions.

This interview takes place after the Government met today for the first time with the social partners, having indicated that it intends to comply with the income agreement in force – and signed by the previous Government with the social partners – but signaling that it intends to revisit it.

Asked whether this means that the progression of salary increases contemplated in that agreement can be changed (downwards), the minister said no.

“The agreement that exists is to be fulfilled until it is replaced or improved or revisited. It is to be maintained as long as the social partners so understand without prejudice” to changing it, signaling that, with regard to the evolution of increases, “if it is changed, it will not be for less.”

Today’s Social Concertation meeting was attended by the Prime Minister, Luís Montenegro, and the Ministers of Finance and Economy, as well as the Minister of Labor, Solidarity and Social Security.