Retirements: significant omission in the decree formalizing the $ 7,000 bonus

In the foundations of the decree 532/2022 published this Thursday in the Official Gazette, which formalizes the bonus of up to $ 7,000 for pensioners, there is a omission linked to the evolution of assets. Mention what happened with retirements between 2017 and 2019 and in 2021, but it does not mention the losses of 2020 and between January and August 2022.

Thus, the decree states that “since this government took office, the recomposition of the pension assets has been a priority, and from the first moment of management various measures have been adopted to try to accompany and strengthen the process of recovering real value. pension and pensions, they had lost 19.5% of their real purchasing power between 2017 and 2019 “.

And he adds that, following the new mobility law, “at the end of 2021, all pensions and pensions updated by that index were 1.1% above inflation for that year”.

surprisingly, the decree makes no mention of what happened in 2020, when retirements lost due to inflation. That year, increases of between 24.3% (maximum credit) and 35.3% (minimum credit) were applied by decree against an inflation of 36.1%. From these values, it follows that the average and maximum assets had an additional loss of up to 8.7%.

In 2022, until August the pension increase is 29.1% (12.28% in March and 15% in June) against an inflation of 46.2% in July. Adding to the likely August price hike, inflation would rise to 55%. A loss of 16.7%.

For higher pensions, taking into account the loss of 19.5% between 2017 and 2019, plus the loss of 8.7% in 2020, minus the improvement of 1.1% in 2021 and the loss of 16 , 7% until August 2022, the accumulated loss between September 2017 and August 2022 is 38%.

For lower pensions, the live loss is lower due to the subsequent bonuses which were granted because the mobility formula was insufficient in the face of rising prices.

Those bonuses – which were awarded in 2020, 2021 and this year – they have not been integrated into current assets. This means that the increases according to the mobility formula are calculated on a lower basis e the loss of the pension becomes permanent. For example, the 15.53% of September is calculated on the assets of August, the month in which no bonus is collected.

In September and through November pensions increased by 15.53%, with which they will accumulate an increase of 49.2% for that month.

Precisely because of this new loss, the Government decided to concede a bonus of up to $ 7,000 for those who earn up to 2 minimum assets. Those who earn more than $ 90,000 are excluded, those who in November they could have an additional loss of more than 15%.

In 2022, with bonuses, the minimum pocket income rises to 73.3% between the first 9 and 11 months of the year, leaving the question of what could happen with the mobility of December, which will not take into account the bonuses and why by November inflation could be around 90 or more.

The current mobility formula, which combines remuneration with collection no guarantee on inflation, comes into effect with a three-month delay (the September-November increase is based on the April-June variables). And in a growing inflationary context, retirees, retirees and recipients of social benefits it faces higher inflation with lagged assets compared to the prices that are adjusted and renewed day by day.

In the case of the formula in force in the last 2 years of Mauricio Macri’s government, which took into account 70% of inflation and 30% of formal salaries, it was applied with a delay of six months, which increased the loss of pension.

Therefore, in addition to its retroactive application “skipping” a quarter, between September 2017 and December 2019, the mobility of pensions and pensions and other social benefits worsened by 19.5% compared to the average increase in prices.

Alberto Fernández’s initial response to this deterioration was not the promised healing, but worsened the decline in assets for a section of retirees. In March 2020 there were differentiated increases by decree and that year the assets increased between 35.3% and 24.3% against an inflation of 36.1%, flatten the pyramid forecast. This loss and that of this year is the one that is not mentioned in the foundations of decree 532/2022.

NEITHER