First, Labor Minister Celestino Corbacho wants to limit the possibilities of early retirement rather than delay retirement age. This is one of the major themes of the reform of the social security and pensions (the Toledo Pact), which he offered to negotiate with the social partners.
The Minister of Labor, who requested to speak before the Parliamentary committee which monitors the Toledo Pact, wants to renegotiate an agreement on a new definition of the pension system with the social partners. He highlighted the fact that, contrary to some of his European counterparts, he is not yet willing to postpone retirement age. His objective is that more employees remain active until legal retirement age. He says he needs to "end the early retirement culture." Even if the number of early retirements has decreased in the past few years, in the advantageous context of a generalized and extended drop in unemployment, it is still not enough for him. In Spain, average retirement age revolves around 62-63 years old, but some companies encourage their employees to leave between 52 and 58, receiving unemployment benefits at first, and then the early retirement system after 60. The Minister insisted on how much these practices cost the State, whereas life expectancy is increasing. He also pointed to the negative social impact of this premature desertion of the labor market, which implies an impoverishment of companies’ knowledge capital. This is why he wants to amend the Toledo Pact, to limit the appeal to early retirement to ailing sectors, and under very specific circumstances.
Reforming widows’ pensions. One of the other measures mentioned in the framework of a possible revision of the pension system is a reorganization of the widows’ pension system, in order to adapt it to the presence of women on the labor market and to the fact that they are full taxpayers, that they don’t depend on the income of a third anymore. The Minister said that the lowest female pensions could still be topped up, and also an increase in the current widows’ pension. In addition, he announced that he wished to add farmers and domestic workers into the general social security system; for the time being, they have a special system.
Planet Labor, July 1, 2008, No. 080550 – www.planetlabor.com