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Retirements: how they look with the changes in Javier Milei's new formula

2024-03-26T12:55:22.086Z

Highlights: Retirements: how they look with the changes in Javier Milei's new formula. In April there will be an increase of 27.35%, which starts with a loss because it does not fully recognize the January inflation. The Government must publish a decree so that retirees with minimum salaries receive the entire increase. In this way, if the bonus is not increased, the real pocket increase will ultimately be 18% (rising from $204,445 to $241,216) as Clarín anticipated in Sunday's edition.


In April there will be an increase of 27.35%, which starts with a loss because it does not fully recognize the January inflation. The Government must publish a decree so that retirees with minimum salaries receive the entire increase.


The Government must publish in the next few hours in the Official Gazette a new decree modifying decree 268/2024 of last Thursday in relation to the $70,000 bonus for minimum salaries.

The new decree is necessary because, in order for

the $70,000 bonus to be maintained,

it is necessary to modify the ceiling of $204,445

for minimum-income retirees set in decree 268/2024.

Thus,

with the increase of 27.35%, the minimum asset will rise in April from $134,445 to $171,216.

And with the $70,000 bonus,

the total income will be $241,216, compared to the “capped” $204,445 in March

.

Since the bonus is not increased,

the real pocket increase will ultimately be 18%

(rising from $204,445 to $241,216) as

Clarín

anticipated in Sunday's edition.

On the other hand, the complexity of Monday's DNU 274/2024 on retirements and pensions has an explanation: the so-called

junction

between the formula that ceases to exist and the new one.

The thing is that both when it was executed by Mauricio Macri in 2018 and Alberto Fernández in 2020,

they were challenged in court

, appealed by the ANSeS, and

are still awaiting the ruling of the Supreme Court.

That is why

the DNU postpones the connection to the month of June

.

The thing is that if it were done in April, the increase next month would not be 27.35% (12.5% ​​plus 13.2% for the February CPI) but 36.6% (January + February CPI) that the March increase already granted takes into account the variables from October to December.

Or it should be 41.5% (25% + 13.2%) if the smaller increase in December is incorporated in relation to that month's inflation plus February inflation.

To avoid giving 36.6% or 41.5% in April,

the DNU postpones the connection until June

because it says that “for the purposes of the transition, for the determination of the mobility corresponding to the month of June 2024, it will be “the formula in force on the date of issuance of this document is applicable” (that of Alberto Fernández).

And until then there will be

increases on account

that would be granted in April (12.5% ​​+ 13.2%) and determined in May (according to March CPI) and in June, according to April CPI, but

that month the value that will be applied will be applied. be greater between what has been granted since April and the result of Alberto Fernández's formula.

Only in July will the new formula be applied according to May inflation

and thus in the following months

according to the evolution of inflation from 2 months ago.

And there is no additional increase if wages or the economy grow.

In this way,

at the time of the connection between the two formulas there will be no harm to the retiree in the second quarter

– which could give rise to

legal claims

– in relation to if the connection were made in April.

All this complexity does not nullify the fact that

the loss of assets occurs at the beginning, in April and not in June

, because next month's increase recognizes only 12.5% ​​for January and not the 20.6% of inflation and even less 25% for January inflation plus the December loss.

For this reason,

the opposition questions that the April increase will only be 12.5% ​​for January and not 20.6% or 25%.

The evolution of the minimum assets will depend on

whether or not the current bonus of $70,000, as happened in April when it remains unchanged as in March,

will have additional adjustments.

In April,

retirees who collect the bonus have an increase of 18% versus 27.35% for the rest

.

In this way, if it is not updated for inflation, the bonus becomes liquid because it loses weight in the retiree's total income.

NE

Source: clarin

All business articles on 2024-03-26

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