Two measures in the anti-crisis package approved by the Government this Saturday will increase the income of vulnerable citizens by 15% between July 1 and the end of 2015. They include a 15% increase in payroll to nearly 450,000 beneficiaries of non-contributory pensions and a 15% increase in the Minimum Vitality (IMV), which has been in effect for three months and is currently enjoyed by almost 1.2 million people who are vulnerable.
According to President Pedro Sanchez, approximately half a million pensioners will be receiving “an additional 60 euros per month, 360 euro more between now and December” in order to cope with the current runaway price situation. This measure is based on an agreement that was recently reached with Bildu. IMV beneficiaries will receive the exact same amount.
According to Imserso- May data, 445,069 people currently receive a non-contributory retirement pension. Of these, about 65% are women who are not working or have not been able to access a contributing pension for at least 15 years.
Non-contributory benefits are limited to two types. One is retirement for those over 65 who have reached the legal retirement age. The other is disability for those between 18 and 65 who have a recognized disability at least 65%. The beneficiaries must reside in Spain and have a minimum of five years of residency (disability) or ten (retirement). They cannot earn more than 5,890 euros per year, which is the same income as the non-contributory pension. However, this amount can rise if they live with relatives.
The average monthly amount of non-contributory pensions received by 264,737 individuals is 421 euros. They will be receiving a 15% increase and a little more than 63 euros per monthly, or 442 euros total, if they add the seven payrolls that they will receive between now to the end of the calendar year (in December, they receive an additional pay).
There are also 180,332 additional disability benefits with an average of 462 euro per month. This means that beneficiaries will see their income rise by 70 euro per month and total 491 euros at the end 2022.
The monthly cost of the State of non-contributory retirement pensions amounts to just over 195 millions euros. A 15% increase in December will result in a nearly 25 million additional expense. Since April, the IMV has been applied to approximately 270 million people.
After 2022 is over, the Executive will need to decide whether to keep the increase or cut the extra 15% to the most in-demand groups.
