When and how will retroactive payments be made to retirees

From the end of June, the gradual payment of retroactive payments and increases to retirees, who have more than 30 years of insurance, is already in progress, pursuant to law 4670/2020, which provides for improved replacement rates.

According to Ministry of Labor officials, the process of recalculating pensions is an extremely complex and, therefore, time-consuming process. It is indicative that, in Greece, there are more than 1,000 different ways of insuring employees, something  reflected both in the process of issuing pensions and in the calculation of retroactive and increases, they point out.

The services of the Single Social Security Entity have already made payments to thousands of retirees.

In particular:

-In June and July, 65,000 (after May 2016) new retirees of the public and the private sector saw permanent increases in their pensions by an average of 5.1% as well as retrospectively by an average of 1,000 and 860 euros respectively. The total amount paid was 58 million euros.

-For 29,032 cases of new retirees whose recalculation of pensions is pending, this will be done by the end of October and the payment of the amounts to the beneficiaries will be made gradually. For 2,600 cases of deceased pensioners, a special platform will be opened in the coming days for the submission of applications by their heirs.

For the old retirees (who submitted a retirement request before May 2016), the technical checks by the services of the Single Social Security Entity and the contractor company show that the final number of beneficiaries is much smaller than what was expected.

In detail:

– Retirees before May 2016 are approximately 1,800,000

– 1,050,000 of them have less than 30 years of insurance and, therefore, are not entitled retroactively to increases pursuant to the law.

– The remaining 750,000 have more than 30 years of insurance and are part of the recalculation process. Out of the 750,000:

–100,000 are difficult cases of pensions, with errors or incomplete data that need further processing. The goal is that, by the end of the year, those who are entitled to retroactive and increases have been recalculated and paid. It is estimated that about 20% of them are entitled to retroactive and increases.

– From the remaining 650,000 retirees it appears that only 130,000-150,000 are entitled retroactively to increases. The rest are not entitled due to personal dispute and do not fall under the requirements of the law.

Therefore, from the total number of retirees before 2016, it appears that only 8% will eventually receive retroactive increases.

In addition, the increases and retroactive payments they will receive will be less than those received by the 65,000 new retirees paid by the Single Social Security Entity in June and July.

Payment schedule

The Single Social Security Entity’s goal is to have retroactive payments increased by the end of October:

-To the 150,000 old retirees

-To the 29,000 cases of young retirees that are pending.

By the end of the year, the recalculation of the 100,000 old retirees will have been completed and the amounts will have been paid to those entitled (it is estimated that approximately 20% of them are entitled to retroactive pensions and increases).