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Pension reform: who will be affected by the minimum pension of 1200 euros per month?

2023-01-11T15:56:11.176Z


This amount will represent 85% of the minimum wage, taking into account future revaluations linked to inflation.


A life of work must guarantee a dignified retirement

”, assured Élisabeth Borne during the announcements on the pension reform on Tuesday.

On this occasion, the Prime Minister mentioned "

the revaluation of pensions for retirees

" to 85% of the net minimum wage, against 75% currently.

A measure of “

justice

”, according to the executive, which should make it possible to support the purchasing power of the most fragile.

Le Figaro

takes stock of this announcement.

To discover

  • Pension reform: calculate the age at which you will finally leave

Read alsoPension reform: these new expenses which risk cutting into the expected savings

Who is affected by this upgrade?

According to Élisabeth Borne, it will concern “

employees and the self-employed, in particular craftsmen and traders, who have contributed all their lives with income around the Smic

”.

Farmers will also be affected.

Concretely, the minimum pension will increase by “

100 euros per month

” for future retirees leaving from September 1, 2023.

In addition, the government wants this minimum pension to be indexed to the minimum wage instead of inflation, for the general scheme and the scheme for agricultural employees.

Taking into account the next increases in the minimum wage expected in the coming months, the minimum retirement pension will indeed reach 1,200 euros gross monthly from this summer.

In all, this should cost the government more than a billion euros.

To benefit from the increase, you must have completed a full career, meeting the conditions for a full rate.

This is not to be confused with the legal retirement age, set at 64 by the new pension reform.

For example, if you were born in 1975, you will either have to work 43 years, or reach 67 to receive the minimum pension of 1200 euros.

Read also Pensions: Nupes promises a “black January” to the government

In addition to new entrants, nearly two million current retirees should also benefit

from “an upgrade

”.

This point, discussed by parliamentarians, was particularly highlighted by Les Républicains.

In response, Elisabeth Borne clarified that this component will be included in the bill presented to the Council of Ministers on January 23.

"

Our objective is to increase the minimum wage to 85% for current retirees this year

," she said.

When will retirees be able to receive these 1200 euros?

For current retirees, the revaluation should happen "

this year

", certainly by the summer, said Elisabeth Borne.

This entails "

a huge work of the pension funds

" to identify each eligible Frenchman, added this Wednesday morning the Minister of Labor, Olivier Dussopt, on

RTL

.

Please note that no steps will be required for retirees.

At the same time, new entrants should receive “

1200 euros gross in September 2023

”, noted the Minister of Labor.

Of these 1200 euros, what will be the amount actually received by retirees?

This is the most complex point of this revaluation.

Indeed, on this gross income, several contributions for social protection are deducted to arrive at a net salary.

However, these differ according to the person, their reference tax income, and therefore the composition of their household.

Among the social contributions, the general social contribution (CSG) represents the largest share, up to 8.3%.

Four levels exist: a zero rate, a reduced rate of 3.8% (fully deductible from taxable income), a median rate of 6.6% (including 4.2% deductible from taxable income) and a normal rate of 8, 3%, of which 5.9% is tax deductible.

In addition to the CSG, there is also the contribution for the reimbursement of social debt (CRDS) at 0.5%, the additional solidarity contribution for autonomy (Casa) at 0.3% and health insurance at 1% – deductible from taxable income -, only on supplementary pensions.

Thus, each pensioner eligible for 1200 euros gross will not receive the same pension in his bank account.

Does the minimum pension correspond to the “minimum old age”?

No, these are two different incomes.

The “

minimum old age

” corresponds to the solidarity allowance for the elderly and is part of the social minima.

It is not affected by the new pension reform and is aimed, for example, at employees who end their career without being at full rate.

In 2023, it also climbs to 961.08 euros for a single retiree and 1492.08 euros for a couple.

The government also emphasizes the difference between these two elements: the minimum pension will be “

200 euros more than the minimum old age

”, he notes in the press kit devoted to the pension reform.

Source: lefigaro

All news articles on 2023-01-11

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