With the fundamental lines of the reform of the public pension system already on the table, it seems evident that a good part of the improvement in the System’s income during the next decades will come from the greater contributions to Social Security that the highest incomes will have to make. . In fact, only the measure that refers to the progressive stoppage of the maximum bases will mean, within the marked period of 30 years, that these contributors with bases of more than 49,000 euros per year must contribute up to 5,600 million euros more each year to the coffers for the payment of future pensions and benefits.
As exposes the analysis carried out by the Willis Towers Watson Pensions Observatory and the Research Group on Pensions and Social Protection of the University of Valencia and the University of Extremadura, ignoring the problems that it may have in the labor market, uncover the bases Quotation has an immediate effect that translates into higher quotes. Specifically, according to data from the survey on the salary structure of the INE and Social Security, in 2019 it would have resulted in an increase in collection of about 5,600 million euros, which represents a 3.90% of contributions of that year. Compared to 2018, it represented a decrease in collection of 11.61%, due to the fact that the rise in the maximum contribution base, of 7.87%, was well above that experienced by the average salary, of 1 , 61%.
In this context, the removal of the maximum contribution base could translate into a slight improvement in the sustainability of the system only in the event that the maximum pension is not released. “However, it seems logical that, sooner or later, with a more or less extensive transitional period, it is inevitable that there will be a maximum pension clearance or, at least, a significant rise in this “, explains Enrique Devesa, consultant at the Willis Towers Watson Pensions Observatory.
Maintain contributivity
One of the points of friction on the eventual process of increasing the maximum contribution bases is the correlation that should exist with the maximum pension, which should rise at a proportional level to maintain the principle of contributivity of the system.
As determined by the analysis carried out by the experts, one of the measures that has been considered for a long time in the framework of the deliberations of the Toledo Pact, although it has never been carried out, is the possible stoppage of the maximum contribution base. The Commission’s latest recommendations in this regard refer to the fact that “the relationship between maximum contribution bases and maximum pension must maintain the necessary balance between contributions made and benefits received to guarantee contributivity, but without undermining the solidarity dimension of the system. “Likewise, the Commission considers that” the relationship between both variables must be legally established in a clear and stable follow-up”.
Up to 11,000 euros of gap
Gregorio Gil de Rozas, director of the Retirement area of Willis Towers Watson in Spain, points out that “as is normally the case with the Toledo Pact recommendations, they do not set a quantitative criterion on this point. They limit themselves to affirming that it is done clearly and And this is not a trivial issue because, up to now, the path that the variables of maximum pension and maximum contribution base have traveled does not seem to have followed a predictable or reasonable criterion and it is observed that the gap between the two has followed a upward trend, going from 1.10 in 2010 to 1.30 in 2020 and slightly decreasing to 1.29 in 2021. In the interval from 2010 to 2021, a maximum contribution base about 11,000 euros higher than the maximum pension, which affects the principle of contributory proportionality “.
As the analysis shows, the existence of such a wide gap could discourage making contributions, since the differential between both variables is an amount for which contributions are made but that does not generate the right to a higher pension. “Naturally, this must be taken with some caution because the pension is obtained by averaging the contribution bases of the last 24 years (it will go to 25 years in 2022) updated with the CPI. This tendency to increase the gap between both variables is what which has been called “the silent reform”, because apparently it was only a change in both amounts that did not even require consensus with social agents, “explains Gil de Rozas.
The analysis concludes that the double stoppage would improve the tax equity of the system and would be more reasonable from a global point of view but would not improve its sustainability. However, if the objective is to increase the income of the system, the best way would be to unclog only the maximum contribution base, even though this would harm workers with high contribution bases. It should be remembered that Minister José Luis Escrivá himself drew a path of increase until reach the 60,000 euros per year cap, which represents an increase of 22.8%.
The maximum pension will reach 3,300 euros after raising the price of high incomes twice as much as in average ones
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