The International Monetary Fund (IMF) warns the Government of Spain about the pension reform, which will make the System more unsustainable if complementary measures are not taken on spending and income. In this way, it disfigures the cabinet led by the Minister of Inclusion, Social Security and Migrations, José Luis Escrivá, that “the pension reform has prioritized social acceptability and sufficiency, but concerns remain about sustainability in the event that no additional measures are implemented “. The agency assures that only the measures approved in the first package that will enter into force from January 1 will mean an increase in the spending of 42 billion of euros, that is, about 3.5 percentage points of GDP.

Specifically, the international body warns about the effects that the indexation of pensions to the CPI will have in the medium term, on the one hand, and the repeal of the sustainability factor, on the other. It should be remembered that, currently, State spending on pensions amounts to 13 percentage points of GDP, although once the effects of the current reform have been deployed, this level would grow until reaching a 16.5% of PIB.

“According to the current reform proposal, pensions are will be permanently indexed to inflation of the consumer price index (CPI) and the sustainability factor will be revoked from 2021. This would increase annual spending on pensions by 3.5 percent of GDP between now and 2050, compared to the full implementation of the previous legislation, “the Fund points out in a statement by the agency’s technicians on the specific case of Spain.

Read more @Sports Finding