A kind of “super bonus” not in construction but in the payroll, namely: a higher salary with an economic incentive, up to the age of 71, compared to the current retirement, aimed at those who decide to voluntarily leave work. 67 age limit set by the Fornero law. This is one of the ideas put forward in the eleventh report of the study center on Social Security Programs, which was presented to the House of Representatives on Tuesday, January 16, with the aim of making the Italian pension system more sustainable in the medium and long term. Other proposals to guarantee the stability of the system, which is threatened by the increasing aging of the population and the serious decline in the birth rate, concern freezing the contribution seniority for men at 42 years and 10 months (one year less for women). and equalizing the pension rules of “contributors” (post-1996) with the pension rules of other workers.
Why would there be a need for a big bonus for those who stay? It all starts from some reflections and real data. According to the report, even if the majority of workers born between 1946 and 1964, called the “baby boomer” generation, retire, the social security system in Italy will remain stable and sustainable for another 10-15 years. . However, threats to the future are visible at a glance: According to the study center’s experts, a decisive change of direction is therefore needed to guarantee the sustainability of the system in the coming years. The gradual aging of the population and the decline in the birth rate (which has no signs of decline yet) will cause our country to experience one of the “most difficult demographic transitions in history.”
There are a lot of retirees: average age is 63
Just take a look at the numbers. In the report submitted to Montecitorio, Itinerari social security notes an increase in the number of retirees: checks reached 16,131,414 in 2022, compared to 16,098,748 in 2021 and 16,004,503 in 2018. According to the research, the rate is improving, albeit slowly. among retirees and active workers: It is at 1.4443 in 2022, just below the safety threshold set at 1.5. The positive record was only achieved in 2019. The increase in social spending, from 73 billion euros in 2008 to 157 billion euros in 2022, also contributes to the burden of public accounts: +126% in ten years.
However, the analysis by Itinerari previdenza calculates a decrease in pension expenditure: in 2022 the figure amounted to 247.588 billion, which corresponds to 12.97% of GDP. In 2021, the impact on gross domestic product reached 13.42%. When social benefit costs for public employees’ social increases, minimum supplements and GIAS (management of welfare interventions) are netted out, the impact of pension expenditure on GDP drops to 11.7%, in line with the Eurostat average. According to the Social Security Programs, “getting these data accurate is vital to prevent overly high estimates from persuading Europe to cut pensions, which keeps spending in check.”
Alberto Brambilla, head of social security at Itinerari, warns of public debt that “could exceed the threshold of three thousand billion euros”, in addition to the gap created by retirees of the “baby boomers” generation. According to the report, Italy is among the countries with the lowest average retirement age in Europe: 63 years.
Super bonus for those who retire at the age of 71
The conclusion is therefore that we need “measures aimed at promoting the maintenance of an adequate level of employment for the upper segments of the population”. Like giving a “super bonus” to the payroll for “those willing to work voluntarily until the age of 71”, which will mean a higher salary and “33% of the contribution to the payroll for three years will be net of taxes”.
We need reforms and a change of pace to have a sustainable system from 2040 and to prevent a gap in social security. The labor center’s report states that the retirement age should be extended, which “should increase gradually while avoiding excessive advance payments” and that the focus should be on “active aging of workers”. In practical terms, this will mean limiting the instruments for pension advances that have been introduced in recent years and subsequently amended from time to time (quota 100, then quota 102 and finally quota 103). At the same time, the minimum seniority that must be achieved for early retirement should be set at 42 years and 10 months for men and 41 years and 10 months for women, with a lower threshold allowed only in some cases: childbirth, early work or frailty. And then there’s the “super bonus” for keeping accounts in order and guaranteeing future pensions.
Source: Today IT
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
