What’s going on:
On Thursday, Spain’s Parliament gave their stamp of approval to the government-proposed changes to the pension system, which will increase contributions for approximately 11 million pensioners. Most of the added expense will be shouldered by the country’s highest earners and their employers.
The leftist coalition government, backed by the unions, declared that the alterations would bring security to the pension system, which is under immense strain due to one of Europe’s largest aging populations.
Across the pond in the UK, the decision to increase the pension age to 68 has been delayed until after the election.
Why it matters:
In stark contrast to the raging protests in France against the government’s attempt to increase the retirement age to 64 and reduce some benefits, the Spanish government has opted to increase revenues through increased taxation, with expectations of an extra 15 billion euros.
The UK’s state pension age of 66 is set to experience an increase to 67 between 2026 and 2028, and then to 68 for individuals born after April 1977, between the years 2044 and 2046.
Many different governments around the world are attempting to make changes in order to sustain the economy of their nations, but these changes aren’t always favorable to their citizens.
How it’ll impact the future:
As a general election looming in the autumn of next year, UK ministers were anxious that the change in pension age might provoke resentment amongst middle-aged voters. The riots in France over the proposal to raise the pension age from 62 to 64 have been a warning sign for British officials advocating for this change, so it has been delayed.
As for Spain, millions of its residents will have to increase their pension contributions, rather than have the age of retirement increase.
