Pensions could increase in June due to inflation, according to Jurečka, the conditions have been met

>> Illustrative photo – Minister of Labor and Social Affairs Marian Jurečka at a press conference in Prague after the government meeting, January 25, 2023.

Prague – Old-age, disability and survivors' pensions could increase due to inflation to increase again in June. Minister of Labor Marian Jurečka (KDU-ČSL) told ČTK today that the conditions for valorization have been fulfilled. His office should have details on the possible amount and form of the addition next week. At the end of last year, over 2.84 million people received a pension from the Czech Social Security Administration (ČSSZ), of which 2.37 million had an old-age pension. According to the ministry, the average retirement pension in January was 19,438 crowns. The ministries of the interior, defense and justice also have their pension systems.

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“The legal conditions for valorization have been met,” Jurečka told ČTK.

Pensions consist of two parts. The solidarity basic amount is the same for everyone and corresponds to ten percent of the average salary. This year it amounts to 4040 crowns. The merit percentage part then reflects the years worked, the amount of contributions from earnings and the number of raised children. In the case of extraordinary valorization, the percentage is increased according to the Pension Insurance Act.

The extraordinary addition follows the fifth month after a month in which the increase in the price index for the period under review exceeds the five percent mark. The percentage is increased by as many percentages as the increment. This time it is calculated from last July to January this year.

Data on January inflation was published today by the Czech Statistical Office. Consumer prices have risen by six percent since December. They increased by 17.5 percent year-on-year. The increase from last July to this January is seven percent. In the valuation, however, the price increase for pensioner households, which was even higher, can be taken into account. The minister will publish exact data on the form and amount of the addition next week.

According to experts, the rules for extraordinary valuations should be adjusted. Experts and some politicians point out that people with low pensions, who feel the increase in prices more, will improve less in the case of extraordinary increases in pensions due to high inflation. They criticized the government for not changing the settings yet. They also mentioned a big impact on the budget. Last year, two extraordinary valorizations increased pension expenses by approximately 29 billion crowns. Every year the sum increases.