BUSINESS

Ceiling to be forced on 70,000 pensioners

ROULA SALOUROU

TAGS: Finance

Over 70,000 Greek pensioners will suffer significant cuts to their pensions – retroactively too – in the coming days owing to the imposition of a ceiling on their monthly handouts.

Effective as of June 1, 2016, the new maximum level is set at 2,000 euros gross (or 1,767 euros net) for each individual pension and 3,000 euros gross for each retiree’s total income from pensions.

The retroactive cuts will be made in installments of a minimum monthly amount of 50 euros. The cuts will be biggest in the first few months.

The biggest losers from this latest set of cuts will be doctors, lawyers and engineers, who receive two or three pensions, as well as former utility company and bank officials.

As a result, people with two pensions who escaped the impact of the existing ceiling as they collected pensions from two separate social security funds will from January also suffer cuts if their new single monthly pension (due to the merging of the funds) exceeds 2,000 euros gross. There is an exception for those who receive pensions for other reasons (e.g. old-age pensions, widows’ pensions etc).

Furthermore, in the new year, 10 major changes will be introduced to the social security system. The law introduced by former minister Giorgos Katrougalos will recalculate all pensions, slash new pensions by 30 percent, further reduce the EKAS allowance for low-pension retirees by 40 percent, and cut 234 million euros from auxiliary pensions.

There will also be a major increase in the cost for civil servants seeking to buy out their contributions, cuts to widows’ pensions, a reduction in bank employees’ pensions etc.

Online