Social Security recorded the largest budget surplus in more than a decade, to EUR 4,059 million in 2022, an improvement of EUR 1,711 million compared to 2021, the Public Finance Council (CFP) proposed on Thursday.
The surplus was achieved in a year in which Social Security continued to be impacted by the measures taken in previous years due to the pandemic, as well as the approval of new aid in the context of the geopolitical shock, the CFP says in its report on the budgetary evolution of social security and Caixa Geral de Aposentação (CGA) in 2022.
“The increase in effective sales of EUR 2,220 million contributed to this result, exceeding the increase in costs of EUR 508 million,” the report reads.
The impact on expenditure of the measures implemented in the context of covid-19 was 607.4 million euros in 2022, with an amount allocated to its financing of 616 million euros.
However, says the CFP, “in the case of the measures taken after the geopolitical shock, it is only possible to determine the total value of the measures (1,326.2 million euros), without the corresponding identification of their financing is made, not being, therefore it is possible to clear the effect on the balance”.
“The lack of this information on revenues undermines the transparency of the budget implementation of this subsector, since it is not possible to verify whether or not these measures, which should have no impact on the social security balance, were fully financed by the State Budget (OE),” warns the organization headed by Nazaré da Costa Cabral.
Social security revenues, excluding the European Social Fund (ESF) and the European Fund for Aid to the Most Deprived (FEAC), increased by 6.9% compared to the previous year, mainly due to the increase in the social contributions by 11.8%.
The growth in contributions “translates the increase in remuneration declared to social security and the net creation of jobs, thanks to the favorable macroeconomic environment, as well as the increase of the guaranteed minimum monthly allowance (RMMG) by 40 euros ( from 665 euros in 2021 to 705 euros in 2022), increasing the minimum amount of the basis for contributions and premiums,” explains the CFP.
“Expenditure adjusted for these effects increased by 1.7% compared to the previous year”, not only due to the impact of some of the measures taken in the aftermath of the pandemic crisis (€599.2 million) , which are still in force, but also the implementation of new measures aimed at mitigating the effects inherent in the geopolitical shock (1,309.6 million euros, in total 1,908.8 million euros), can be read in the document.
According to the CFP, without the impact of these measures, actual expenditure would have fallen by 4.7% compared to 2021.
The body also highlights the 6.6% increase in pension spending, justified “by the creation of the exceptional pension supplement and extraordinary pension update portion” and the 123.1% increase in other benefits, “as these aggregated measures of the geopolitical shock , social action (+10.9%), parental benefits (+12.4%), child benefit (+3.9%) and subsidies and sickness allowances (7.3%)”.
“The extraordinary update of pensions and allowances has increased its weight in actual expenditure. In 2017, the first year of implementation, this amounted to 77 million euros, compared to 896 million euros in 2022,” the CFP indicates.
Source: DN
