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Pensions: reflections and questions on the definitive revaluation

5 months ago babelfish

Pensions: reflections and questions on the definitive revaluation

The speech by Michele Poerio, national president of Federspev , and Carlo Sizia, Federspev social security expert

In the period before the Dini social security reform (L. 335/1995) the automatic equalization of pensions took place first on a six-monthly basis and then annually (thanks Amato!!!) in relation to the average variation in the contractual wages of public and private employees.

Subsequently, apart from some "cuts" to the revaluation of pensions above 5 times the INPS minimum, at the end of the 90s, in the early 2000s the revaluation mechanism with respect to inflationary processes stabilized with law 388/2000 according to the following scheme :

  • 100% revaluation for pension amounts up to 3 times the INPS minimum;
  • 90% revaluation for pension amounts between 3 and 5 times the INPS minimum;
  • 75% revaluation for amounts over 5 times the INPS minimum.

The aforementioned "staggered" mechanism, already characterized by a brake on the revaluation of larger pensions, allowed, however, an overall average revaluation of around 80% compared to the ascertained, forecast or definitive inflation.

Since 2008, a real legislative storm has hit the revaluation of medium-high pensions, always conveyed through financial or budget laws, without any comparison with the trade unions. of the interested categories, certainly not represented by politicized confederal trade unionism, in particular:

  • law 247/2007: total lack of equalization for pensions over 8 times the INPS minimum;
  • law 214/2011 (Fornero): failure to equalize for amounts over 3 times the INPS minimum, which subsequently became failure to equalize for amounts over 6 times the minimum, after the censure of the Constitutional Court ruling no. 70/2015 and the "sop" granted for amounts between 3 and 6 times the INPS minimum by Legislative Decree 65/2015 of the Renzi Government which robbed pensioners with medium-high amounts of around 20 billion;
  • Letta law 147/2013: the "staggered" mechanism ceases, the economic bands taken as reference for the revaluation go from 3 to 5 and the increase, in a progressively decreasing percentage, operates on the entire amount of the pension enjoyed, rather than distinct on the different amounts of the individual pension, so that no segment of it is revalued at 100% and the revaluation of medium-high pensions drops from around the average 80% to below 50%;
  • law 234/2021 (valid for 2022), the only pause against the anti-revaluation fury: we return (Draghi Government) to the tiered system on the different amounts of the single pension: + 100% up to 4 times the minimum; + 90% between 4 and 5 times the minimum; + 75% over 5 times the INPS minimum, along the lines of law 388/2000, with forecast inflation for 2022 at 1.7% and definitive at 1.9%;
  • law 197/2022 (first Meloni budget law), valid for the two-year period 2023-2024, which, without even knowing what the forecast devaluation for 2024 would have been, renews the persistence of the Letta scheme, divided into 6 bands based on the total amount of the pension, tightening it, namely: 100% revaluation for pensions up to 4 times the INPS minimum; at 85% between 4 and 5 times the minimum; to 53% for pensions between 5 and 6 times the minimum; at 47% between 6 and 8 times the minimum; at 37% between 8 and 10 times; at 32% for total amounts over 10 times the minimum;
  • budget law 213/2023 (second Meloni budget law): the 2024 revaluation of pensions remains unchanged, compared to the aforementioned law 197/2022, except for a further reduction of 10 percentage points (from 32 to 22%) for the revaluation of pensions amounting to more than 10 times the INPS minimum.

Reflections and questions:

  1. when the devaluation is lower (2022: forecast at + 1.7% and definitive at + 1.9%) medium-high pensions are better revalued (around the average 80% of confirmed inflation); when the devaluation is more severe (year 2023: forecast at + 7.3% and definitive at + 8.1%, with consequent adjustment at the end of the year of + 0.8%) the revaluation of medium-high pensions, in particular of those over 10 times the minimum, drops to 32% compared to the confirmed inflation (therefore in concrete terms + 2.336% increase and + 0.256% adjustment, compared to + 8.1% of the definitive inflation for 2022);
  2. the aforementioned is proven proof that the equalization scheme of laws 197/2022 and 213/2023 (Meloni), as of law 147/2013 (Letta), does not aim to defend medium-high pensions from inflationary insults, but to impose on them an improper levy, of a substantially fiscal nature, beyond the nomen juris , being an authoritarian, worsening and non-recoverable "patrimonial ablation", compared to a perfect right of the offended retired citizen;
  3. but the disfigurement of law 197/2022 regarding the equalization of medium-high pensions was still not enough, they still wanted to rage for 2024 (art. 1, c. 135, law 213/2023) on pensions over 10 times the minimum (already the most penalized), bringing their revaluation to 22% compared to inflation (concretely, taking into account the forecast inflation for the year 2023 of +5.4%, the increase is +1.188%). The trivial proportion + 7.3 : 32% = + 5.4 : x was not even applied (in 2024 to 2023), which would have at least led, with a small rounding, to + 24% in 2024. Given that the inflation was decreasing, the improper tax had to be increased! Other than "legitimate trust" on the part of the citizen, pensioner and voter, in the State and its Bodies and Institutions;
  4. even without taking into account the average revaluation limited to around 80%, introduced by law 388/2000 (now considered consolidated and almost "physiological"), in just 2 years pensions exceeding 10 times the minimum have lost 48 percentage points of equalization in 2023, and 58 percentage points in 2024 compared to the criteria of the Draghi law (L. 234/2021), in concrete terms just under 7% effective;
  5. furthermore, only in the last 18 years, the revaluation of the aforementioned pensions (middle-high of the middle class and of the managerial classes, healthcare in particular) has been eliminated, or severely limited, in 13 consecutive years (72.22% of the period), causing entitlement checks to lose an average of 20-25% of their actual purchasing power. And the colleagues who also had to suffer the recurring "proletarian expropriation of Soviet memory" of the "solidarity contribution" lost more, and all of us would have lost more if, fortunately, the inflation of the years 2016, 2017, 2021 had not been close to 0%;
  6. holders of medium-high pensions, retired for approximately 15-20 years, who have had a salary-based pension recognized by right (average replacement rate of 80-85%), find themselves today in fact enjoying a contributory-like or mixed pension (average replacement rate of 60-65%). All through budget laws, without any organic social security reform and with serious incorrectness on the institutional level of the legitimacy of the sources;
  7. the "patrimonial" on medium-high pensions (from revaluation deficit) is not only jarring because it lacks the universality and progressiveness requirements required by art. 53 of the Constitution, but it is not even justified on a concrete and moral level. Just look at our IRPEF tax system: 13 million potential taxpayers do not pay IRPEF (either because they have no income, or because they are total tax evaders, or because the accumulation of deductions has eliminated their income), 40.5 million taxpayers IRPEF fulfilled the obligation in 2022 and the total declared income, referring to 2021, was made up of approximately 83% of income from employment or pensions. Furthermore, the tax category belonging to pensioners over €60,000 gross/year (pensioners with 8 times the INPS minimum and above), which represents 5% of actual taxpayers, already pays more than 40% of the total IRPEF burden (ratio 1:8 ). These are the official and consistent data from the Mef – Revenue Agency, so what more do you want from us? And the rumored next reform of the tax system has already made progress: given that a tax advantage of €260/year is expected for incomes over €50-55,000 gross/year, it is already foreseen for this class of taxpayers (even if pensioners) a reduction of the same amount in tax deductions!

Having said all this and considered, we need to ask ourselves:

  • what happened to the principle of equality (art. 3 Constitution) if some former workers in the same sector receive a full revaluation of their pension (pensions up to 3 times the minimum and, from 2020, up to 4 times), while for others the revaluation is zero, or severely limited?
  • What reason is there why, with the same income, some pensioners are taxed, in fact, twice, with clear discrimination even compared to active workers?
  • What happened to the necessary relationship between quantity, quality, responsibility, merit, and relative remuneration, as well as the necessary proportion between remuneration and pension (art. 36 of the Constitution) and the repeated affirmation of the Council itself that qualifies the pension, in dozens of sentences, such as “deferred pay”? In this way the leveling triumphs and the merit disappears!
  • What happens to the principle of adapting pensions "to the life needs" of former working citizens when this value is constantly subordinated to the needs of public finances, in clear derogation from the letter and spirit of the art. 38 of the current Constitution?
  • Who, then, inspired such an indecent mechanism of indexation of medium-high pensions in the two-year period 2023-2024, in a period of severe devaluation, perhaps the subtle thought of Undersecretary C. Durigon, who coming from confederal trade unionism must have assimilated, more than the constitutional principles, those of the leveling and mortification, regardless, of high professionalism? We would be sorry if Minister Giorgetti was "in the bag", who we consider to be a shrewd person and not very inclined towards self-goals;
  • when, in the INPS context, will it be clearly distinguished, starting from the budgets and coverage, how much is the responsibility of assistance and how much of social security? In the current chaos, discretion and abuse flourish and the Institute risks turning into a "social-welfare hospital";
  • what about the "good practices" regarding equalization adopted by civilized OECD countries, i.e.: automatic equalization (not subject to the annual whims of budget laws); uniform, i.e. independent of the size of the pension; positive in real terms, i.e. not subject to "cuts" even compared to the forecast and theoretical devaluation to avoid "vintage pensions"?

In the face of such a catastrophe, not even the Constitutional Court has represented a barrier, at least in the last 20 years: too many ambiguities, too many homages to the Palace, too many contortions just to put a "band-aid" on bad legislation, too many judges so careful not to read the current Constitution, but to interpret it as they please, to the point of transforming themselves into abusive legislators.

However, there is no need to despair, despite everything, CONFEDIR, FEDER.SPeV. and APS-Leonida will continue undaunted to defend their members, their direct and reversible pensions, to challenge before the competent judiciaries, in Italy and in Europe, the laws on social security which stink of unconstitutionality a mile away, in the certainty that "there he will also be a judge in Berlin" (paraphrasing Brecht) who loves Justice and Rights, if correctly matured and recognized, not just "claimed and supposed".

However, it would seem paradoxical to have to wait for the devaluation to deflate or be canceled out to finally see a decent mechanism for equalizing our pensions recognized!

This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/riflessioni-domande-rivalutazione-definitiva-pensioni/ on Tue, 09 Jan 2024 06:52:03 +0000.