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This follows from two decisions prepared and announced soon by the Ministry of Labor for the implementation of law 4670/2020, also known as the “Vroutsi law”, which, following a decision of the State Council, significantly improved the low rates of calculation of pensions that had introduced after 30 years the law 4387/2016, also known as the “Katrougalos law”.
The new replacement rates apply to new and old retirees and for this reason, as provided by law, pensions will be recalculated.
THE recalculation, As Free Press reveals today, it will be done in two installments and therefore the increases will be paid in two periods.
New retirees who left with the provisions of law 4387, after 5/13/2016, will be recalculated first, and in the second year the recalculation will be carried out for older retirees who had retired with the old provisions before the law 4387, that is, before 5/13/2016.
For this reason, two circular decisions will be issued, one related to the recalculation and calculation of pensions for young people after retirement on 5/13/2016 and another for the recalculation of pensions for older retirees.
The resulting increases will be paid in any case in 2021 and the new planning is to have the recalculation for the new retirees closed in one month and the new retirees get the increases within January and from February to pay the increases of the old ones. . The original schedule was to end everything, that is, increases and retroactively to old and new retirees, in December 2020. The second wave of the coronavirus and the repeated bans, however, in combination with the malfunction of the State due to forced telework , they brought the process back and now, as mentioned by the Minister of Labor and Social Security, Giannis Vroutsis, there is a new schedule for the January and February raises.
The first circular for the recalculation of the pensions of those who left with 30 years and more on 5/13/2016 and later establishes that the resulting increases will be paid in a single installment, as well as retroactive increases by 14 months. , that is, from October 2019 to December 2020.
The second circular, which is being prepared on the recalculation of old pensions, establishes that the increases will be given if they are higher than the amount of the positive personal difference received by the pensioners and their payment will be in 5 equal annual installments.
Detailed examples
- A 2017 pensioner with 40 years who will have an increase of 170 euros with the recalculation will receive it in a single installment with the pension that will be paid in January and will also receive a retroactive increase for 14 months with an amount of 2,380 euros, such and as provided by Law 4670 of recalculation of young retirees.
- A 40-year-old retiree from 2008 who will have an increase of 170 euros with the recalculation, but who also has a personal difference of 70 euros, will get a net increase of 100 euros in his pocket, because 70 euros will be equivalent to the personal difference he made a personal difference, so the old pension is maintained and the reduction made with the new calculation of the “Katruggalo law” is not applied) The increase of 100 euros will be given in 5 annual installments with 20 euros per year and for February 2021 An increase of 40 euros will have to be paid for 2020 and 2021. The retroactive ones will be for 14 months, but not for the entire amount of the increase, except for the first installment, that is, for 20 euros, in which case the 14 retroactive months will be of only 280 euros, according to the law 4670 of recalculation of old retirees.
How will they be calculated? the new personal differences
Crucial is the question of personal difference for new retirees, as well as what the comparable amount of pension will be during the recalculation. What the services say is whether the pension that will result for pensioners with the recalculation of the “Vroutsi law” will be compared with the pension they received from the “Katrougalos law” or with the pension they would have received if there were no law 4387, to clarify and what will be the new personal difference.
The “Katruggalo law” said that those who have a reduction of more than 20% compared to the pension they would obtain with the old system, will participate in the reduction as a personal difference. For 2016, the personal difference is equal to 50% of the reduction, for 2017 it is 1/3 of the reduction and for 2018 it is ¼ of the reduction.
For example, a pensioner who retired in December 2016 with 35 years of insurance received a pension under the “Katruggalo law” 950 euros before taxes, while under the old regime (before the “Katruggalo law”) he would receive 1,250 euros before taxes. The reduction is 24% (-300 euros), so the personal difference is activated and the pensioner, because he left in 2016, has a personal difference of 50% of the reduction, that is, of the 300 euros of the cut is They returned 150 euros and the final pension is 1,100 (950 euros pension + 150 euros of personal difference).
If you left in 2017, your personal difference is 100 euros and your pension is 1,050 euros (950 euros + 100 euros of personal difference), while with the departure in 2018 the personal difference decreases even more and becomes 75 euros, with the pension at 1,025 euros (950 euros + 75 euros of personal difference).
With departure from 1/1/2019 there is no personal difference, which means that the reduction in the example (-300 euros) goes entirely to the pension and the retiree receives only 950 euros.
What is clarified in the first circular of the recalculation is that in no case will any retiree lose personal differences, if for better rates the reduction falls below 20%. In these cases, the retiree will continue to receive the same total amount as a new personal difference.
For example, if the 2016 pension recalculated with the “Vroutsi law” reaches 1,050 euros (instead of the 950 euros that there was with the “Katrougalos law”), this means that compared to the old 1,250 euros there is no reduction 24% but 12%, so the personal difference mechanism does not apply. The pensioner, however, due to a personal difference, finally received 1,100 euros, while with the recalculation it goes to 1,050 euros. In order not to have a reduction, you will receive a new personal difference of 50 euros and the new pension will be 1,100 euros.
