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ECONOMY

Retirees protest across Spain over ‘shameful’ pensions

Thousands of retirees took to the streets in protest across Spain on Thursday, calling on the government to raise pensions and defend the social security system.

Retirees protest across Spain over 'shameful' pensions
Archive photo of a pensioner protesting. Photo: AFP

The pensioners, many with whistles and wearing ribbons with the brown symbol of their cause, marched in the capital Madrid as well as Barcelona, Bilbao, Seville and Granada.

The union-organised rallies called for “dignified” pensions, saying that the conservative government's 0.25 percent increase fails to keep up with inflation, as Spain's consumer prices rose by 1.2 percent last year.

Former waiter Jose Maria Elias, 66, was one of the hundreds of demonstrators gathered outside Spain's lower house of parliament in Madrid on Thursday.

“The 0.25 percent increase is shameful,” Elias told AFP, adding that he receives €950  ($1,170) a month.

“Let all the corrupt people return what they stole and put it in the pension fund,” he said, referring to the numerous corruption scandals of Prime Minister Mariano Rajoy's ruling party.

READ: Seven facts that show the dark reality of Spain's economic recovery 

“They have demolished our public pension system,” said Josefa Albala, 77, who added that she uses her retirement money to feed her unemployed daughter.    

After coming to power in 2011 as the country struggled in the wake of the global financial crisis, Rajoy's government imposed tough austerity measures and was strongly criticised by the opposition for dipping into a €66.8 billion pension reserve fund.

Rajoy has recently encouraged Spaniards to invest in private pension plans, and a Socialist party lawmaker accused him of seeking to “privatise pensions” during a tense Senate session on Tuesday.

However, Rajoy has said that protecting the public pensions system is a top priority and it would become viable thanks to employee contributions as salaries rise with the recovering economy.

Spain has one of the lowest birth rates in Europe and there are concerns the burden on its pension system will increase in the future, with 25.6 percent of the population expected to be aged over 64 by 2031.

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ECONOMY

Spain’s middle-class youngsters the most likely to end up poor across all EU

Spain leads the ranking of EU countries with the highest risk of young people ending up in poverty as adults, despite coming from families without economic difficulties.

Spain is the fourth EU country with the highest inherited poverty
Spain is EU country with most middle-class young people who end up poor. Photo: Jaime ALEKOS / AFP

Spain is also the fourth EU country with the highest rate of inherited poverty risk, according to Eurostat, the EU Statistical Office.

Data on intergenerational poverty indicates that there is a correlation between the financial situation of the household you grew up in and the risk of being poor when you reach adulthood and in Spain, there is a strong link. 

The latest statistics available from 2019 show that the at-risk-of-poverty rate for the EU was 23 percent among adults aged 25 to 59 who grew up in a poor financial situation at home when they were 14 years old. This is 9.6 percentage points more than those who come from families without financial problems (13.4 percent). 

READ ALSO: Spain’s inflation soars to 29-year high

How the situation in Spain compares with the EU

Spain has become the EU country with the highest risk of poverty among adults who grew up in families with a good financial situation  – 16.6 percent.

This was followed by Latvia with 16 percent and Italy with 15.9 percent.

That statistics also show the countries where it is less likely to be poor after growing up in households without economic difficulties. These include the Czech Republic (5.9 percent), Slovakia (7.9 percent) and Finland (8.5 percent).

The overall poverty rate in the EU decreased by 0.1 percentage points between 2011 (13.5 percent) and 2019 (13.4 percent), but the largest increases were seen in Denmark (1.9 points more), Portugal (1.8 points), the Netherlands (1.7 points) and Spain (1.2 points).  

On the other hand, the biggest decreases in the poverty rate were seen in Croatia (-4 percent), Lithuania (-3.6 percent), Slovakia (-3.5 percent) and Ireland (-3.2 percent).

READ ALSO: Spain’s government feels heat as economic recovery lags

Inherited poverty

The stats revealed that Spain was also the fourth country with the highest rate of inherited poverty risk (30 percent), only behind Bulgaria (40.1 percent), Romania (32.7 percent) and Italy (30.7 percent).

This means that children of poor parents in Spain are also likely to be poor in adulthood. 

The countries with the lowest rate of inherited poverty risk were the Czech Republic (10.2 percent), Denmark (10.3 percent) and Finland (10.5 percent).

The average risk-of-poverty rate for the EU increased by 2.5 percentage points between 2011 (20.5 percent) and 2019 (23 percent), with the largest increases seen in Bulgaria (6 points more), Slovakia and Romania (4.3 points), Italy (4.2 points) and Spain (4.1 points).

The biggest drops were seen in Latvia (-8.5 points), Estonia (-8.0 points) and Croatia (-2.3 points). 

The largest gaps in people at risk of poverty when they reach adulthood were in Bulgaria (27.6 percentage points more among those who belong to families with a poor economic situation as teenagers compared to those who grew up in wealthy households), Romania (17.1), Italy (14.8), Greece (13.5) and Spain (13.4).

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