Funds: The 2022 budget envisages an increase in pension expenditure

By Dimitris Katsaganis

The increase in pension expenditures is provided for in the budget report for 2022. This increase will be due to the expected increase in the number of new retirees, as well as the implementation of the provisions of Law 4670/2020 (Vroutsi law) in terms of percentages. increased expenditure on the payment of supplementary pensions and lump-sum benefits is attributed to the acceleration of the settlement rate of outstanding pension applications.

In detail, for 2022, the budget presentation report states that the balance of Social Security Organizations is projected to be in surplus of 960 million euros, showing a significant improvement, compared to the estimate of MTF 2022-2025, by 576 million euros. .

Total revenues are projected to increase by 974 million euros compared to the estimates of MTF 2022-2025.

In particular, this increase is mainly due to the expected increase in insurance contributions by EUR 538 million, as a result of the expected increase in employment, taking into account the performance data and the revised macroeconomic scenario. At the same time, transfers from the state budget are expected to increase, which is mainly due to:

-the increased grant that EOPYY is expected to receive to cover the cost of offsetting the clawback of pharmaceutical costs with percentages on research and development costs and investment costs of product or service development plans or production lines, and

-the increase of the subsidy to cover the loss of revenues of e-EFKA and OAED from the extension and for the year 2022 of the reduction by three percentage points of the insurance contributions of the employees of the private sector.

Respectively, the expenditures of OKA are projected to be increased in relation to the estimate of MPPS 2022-2025 by 399 million euros.

This increase is mainly due to the increase in the cost of paying main and auxiliary pensions, lump-sum benefits and sickness benefits in kind.

In particular, the increase in the expenditure of the main pensions reflects the expected increase in the number of new pensioners, as well as the application of the provisions of Law 4670/2020 regarding the replacement rates, while the increased expenditure for the payment of supplementary pensions and lump sums benefits is attributed to the acceleration of the settlement rate of pending retirement applications.

2021

In relation to 2021, the budget report states that the financial result of the Social Security Organizations (Insurance Funds, OAED, EOPYY, OPEC and NAT) for 2021 is estimated to show an improvement of 255 million euros, compared to forecasts of MTEF 2022-2025 and is expected to form a surplus of 392 million euros.

In particular, total revenues are estimated to increase by € 644 million, mainly reflecting the estimated increase in insurance contribution revenues by € 454 million.

The revised estimate is mainly due to the effect of the increased growth rate of the economy on the contributions, in relation to the forecasts of the MTEF.

Respectively, the expenditures are estimated to increase by 389 million euros compared to the forecasts of MPDS 2022-2025. This change is mainly due to:

-the increase of social benefits by EUR 164 million, which is mainly due to the increased expenditure on the payment of main and auxiliary pensions and the consequent increase in the cost of payment of lump sum compensation, as a result of the accelerated settlement of outstanding applications and pension applications, of the provisions of Law 4670/2020, regarding the replacement rates of the main pensions and

-the increased, by € 154 million, expenditure on social benefits in kind, reflecting the effort to meet the increased demand for healthcare services in the midst of a pandemic.