Spanish government finalises agreement on pension reform

After months of negotiations, the Spanish government has finalised its plans for a pension reform aimed at cushioning the impact of the wave of baby boomers who are set to retire. State subsidies are to be raised and offset by increased contributions. The draft reform has yet to be negotiated with with employers and trade unions. Can this reform plug holes in the pension funds?

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El País (ES) /

System stabilised, doubts dispelled

El País praises the government:

“There are still some details to be worked out, but both the trade unions and the government partners are taking a positive view of the reform (in contrast to the employers, who reject it outright). The European Commission has done the same and has once again approved a proposal from Pedro Sánchez's government, as it did with the labour market reform. ... This reform builds confidence that the public pension system will remain viable in the medium and long term. Although it may be revised in the future, as Spain has already promised the European Union it will do, this reform dispels some of the uncertainty about our economic future.”

El Mundo (ES) /

At the expense of entrepreneurs and workers

El Mundo is disappointed:

“The reform hinders the creation of new jobs and this will increase the lack of solidarity between generations. ... The document is disappointing. ... The government should have opted for a combination of spending cuts and revenue increases. But it has abandoned its original intention of extending the period over which pensions are calculated, with the result that the reform comes at the expense of companies and workers' wages. ... This will lead to even more obstacles to employment.”