Home / Romania / The pension point will increase by 14 percent from 1 September 2020 (budget proposal). What amount will it reach

The pension point will increase by 14 percent from 1 September 2020 (budget proposal). What amount will it reach

Pension points will increase by 14% from September according to the draft budget. Finance Minister Florin Cîțu announced on Thursday that there will be a significant increase, even though we are in a difficult economic context caused by the coronavirus pandemic.

If the pension point will increase by 14% from 1 September 2020, it will thus reach from 1,265 lei to 1,442 lei, which means an increase of 177 lei.

“It is proposed that from 1 September 2020, the value of the pension point be increased by 14%, respectively from 1,265 lei to 1,442 lei. At the same time, it is proposed to start increasing from the same date with the minimum social contribution for pensioners, by 14% , from 704 lei to 800 lei ”, it appears from the substantiation note.

The pension point is an element used in the calculation of the pension. According to law no. 263/2010 on the uniform public pension system, the size of the pension is determined by multiplying the average annual points achieved by the insured by the value of one pension point.

At the end of June, Florin Cîțu declared on Digi24 that he supports the 10% increase in pensions from 1 September to keep money and investments. Last month, Florin Cîțu, also on Digi24, explained that the scenario for the increase in pensions starts with the Ministry of Finance, which proposes an increase of 10 percent, but the Prime Minister can decide that this increase in pensions will be higher, as it is ultimately a political decision. .

Pensions should have increased by 40 percent from September 1, according to a law passed by the PSD government, but the economic crisis caused by the pandemic makes this increase impossible, which according to specialists would have been difficult to achieve, even under normal conditions.

Florin Cîţu announced on Thursday, during a press conference on the subject of budget correction, that pensions will increase by 2020 by the largest amount the Romanians have ever seen and added to the pension point, but did not specify the value involved.

“From the first moment I said that we will increase pensions in 2020 and today I must come before you and say to you: yes, in Romania pensions will increase in 2020. The pension points, the value of the points will have the biggest increase, the biggest amount we PSD has never increased its pensions by this amount, even though it has had periods of economic growth in succession, three years, not because of them, but because of the international economic context and they still have not increased their pensions by this amount “, explained Cîţu.

The day before the announcement of the budget correction, President Klaus Iohannis had a meeting with Prime Minister Ludovic Orban and the Minister of Finance to discuss the issue.

Higher salaries for education leaders exposed

According to the draft budget, the Ministry of Public Finance proposes that the measure for the pre-use of the salary level set for 2022 for leading teacher and guidance and control staff from training, in accordance with the provisions of Article 38, paragraph 41, letter c) of the Framework Act No. 153/2017 on remuneration for staff paid for by public funds, (…) to apply from 1 September 2021.

“The approval of these measures will lead to a significant reduction in the need for funding to increase teachers’ pensions and salaries, both in 2020, from 11.2 billion lei to 3.6 billion lei, and in 2021, from 34.3 billion lei to 19, 3 billion lei ”, the document mentions.

Finance Minister Florin Cîțu announced on Thursday that the budget deficit is expected to increase from 6.7% of GDP to 8.6% of GDP.

Transport, health and education will receive extra money for the budget correction, the CFO also announced.

Web editing: Luana Păvălucă

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