A “gift” for income support for older retirees, specifically those who retired from 2001 to 2015 and had paid contributions to two insurance funds simultaneously, but have not yet received the corresponding reciprocal pension increase, is being planned by the Ministry of Labor and Social Insurance.
Read also: Social tourism program: Monday applications for retirees – “310,000 applications submitted so far”
Which retirees will receive a “bonus” of up to €400 per month and when?
This specific regulation, expected during the summer, concerns 200,000 retirees from this particular time period, and could increase pensions by up to €400 per month, with EFKA acknowledging that there is an issue regarding the uniform application of the provision for pension increases from simultaneous insurance in two funds.
The issue remains pending and concerns cases where beneficiaries did not complete 16 years of parallel coverage, which is the prerequisite for receiving a second pension.
The pension increase for parallel insurance was provided for by the Katrougalos law (Law 4387/2016), but only for new retirees after May 13, 2016. Older retirees who had retired before May 2016 and had paid into two funds simultaneously were excluded from this favorable provision, and only if they had 16 years of parallel insurance could they utilize it by receiving a second pension at age 67. With fewer than 16 years (i.e., 15 years of parallel insurance), the law gives them nothing. The fact that EFKA does not give a negative response to those who through application seek to claim years of second insurance as pensionable shows that the law for pension increases should also apply to older retirees.
The legislative intervention being examined by the Ministry of Labor
The legislative intervention being examined at the Ministry of Labor aims to eliminate this inequality by extending the increase system to older retirees as well. If implemented, it would be a significant change, as contributions that have remained “inactive” in terms of reciprocity would be recognized.
According to expert estimates, the amount of the increase could be particularly significant, depending on the duration of parallel insurance and the level of contributions. In cases where parallel time approaches 15 years and earnings were high, the increase could reach up to €400 monthly.
When amounts will be lower
In more limited cases, the amounts will be lower, but remain substantial for strengthening available income. A characteristic example is an insured person with 35 years of main insurance at IKA and an additional 10 years in another fund, such as the former OAEE (TEVE). Under the current system, this time provides no benefit since the 16-year threshold is not met. With the new regulation, however, it could be converted into an increase of the main pension, proportional to the contributions paid.
For example, a retiree before 2016 who was 35 years at IKA and had 15 years of parallel insurance at TEVE with contributions of €320 per month, is entitled to a pension increase of €350 from the stamps of the 15-year period at TEVE.
Another retiree before 2016 insured at TSMEDE for 35 years, with insurance also at TAP-OTE for 10 years with an average salary of €1,450, is entitled to an increase in his TSMEDE pension of €213 from TAPOTE.
The pension increase for parallel insurance is calculated with a coefficient of 0.075% per year and for each additional contribution unit above 20%. The 15 years of parallel insurance give an increase coefficient of 22.5%. This coefficient is multiplied by the pensionable earnings that the insured had during the period of parallel insurance, resulting in the corresponding pension increase. If it involves parallel time in freelance professional funds, pensionable earnings are derived by dividing the monthly contribution by 0.20.
It’s worth noting that applications already submitted to e-EFKA are not rejected but remain pending, awaiting final regulations, which shows that the organization’s administration is preparing for possible mass file re-examination if the relevant regulation proceeds.
Experts point out that submitting an application at this stage serves as a means of securing rights, especially in case the regulation acquires retroactive character. At the same time, it allows the insured to be immediately included in the recalculation process when it is activated.
Published in Sunday’s Apogevmatini
