Reforms in Portugal will be halved in less than 20 years, according to estimates by the European Commission – Observer

Reforms in Portugal will be halved in less than 20 years, according to estimates by the European Commission – Observer

From the next decade onwards, the discrepancy between recent earnings from work and pensions for retired Portuguese will accelerate – by 2040, the European Commission expects that Retirees start to live on a little more than half of their salary.

The account appears in the report.Aging Report 2021“- Available at this link – which was updated by the European Commission last week and highlighted this Wednesday before Daily news. This is a report that analyzes demographic developments every three years and confronts them with the sustainability of national pension systems.

In 2019, European Commission calculations indicated that the replacement rate (between last salary and retirement) was 74% in Portugal, a figure that could rise to nearly 85% by 2025, more than four-fifths of the salary. . Then the problem comes: until 2040, that is, in less than 20 years, it was The ability of pensions to replace employment earnings in Portugal drops to 54.5% – and by 2045 it will be less than half (48.2%).

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This trend is not limited to Portugal. The only exceptions to this decline are Cyprus, Hungary, Malta, Romania, Slovenia and Slovakia.

Moreover, the trend in all other countries is to increase the inconsistency, in an unfavorable way, though Portugal appears as the country of most concern – Besides Spain, where the rate will also drop below 50% ten years later than Portugal, in 2055, according to projections.

By Andrea Hargraves

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