PENSION INCREASE. Agirc-Arrco endorsed the revaluation of supplementary pensions up to 5.12%. This increase represents an annual impact of 4.5 billion euros, entirely financed by the scheme.
[Updated on October 7, 2022 at 10:25 a.m.] It’s now official, the supplementary pensions of former private sector employees will increase from November 1! The representatives of the employers’ organizations and trade unions, responsible for the Agirc-Arrco scheme, decided to increase an additional 5.12%, during the board of directors on October 6, 2022. News welcomed by Brigitte Pisa, vice-president of the Agirc-Arrco: “The balance found around this revaluation once again demonstrates the solid and responsible management by the social partners of a major pension scheme, a common good for employees and retirees in the private sector”.
But then, how does the Agirc-Arrco scheme achieve such an amount? What is his calculation? “Based on a change in the average salary of 4.82%, to which is added a catch-up of 0.1% in respect of inflation observed in 2021, the social partners have decided to grant the Board of administration an additional margin of maneuver of 0.2%, compatible with the financial trajectory of the regime” indicates the official press release of Agirc-Arrco. Would you like to know more about this sometimes misunderstood organization? Here is our complete and dedicated article on Agirc-Arrco:
The rules for increasing supplementary pensions (Agirc-Arrco, for example) differ from those for basic pensions. These supplementary pensions are calculated from the number of points acquired during the career, to which a value of the point is multiplied. Then, the social partners decide on a possible revaluation of the value of this point.
Generally, these pensions are increased every year on November 1st. In 2021, the value of the Agirc-Arrco point was revalued by 1%. Regarding these supplementary pensions, the Minister of the Economy Bruno Le Maire was clear: “It is up to the social partners to upgrade the supplementary pensions. We will upgrade the basic pensions.”
After the board of directors of October 6, Agirc-Arrco endorsed the 5.12% increase in supplementary pensions from November 1, 2022.
The first payment of the pension increase for the basic scheme therefore took place on September 9, 2022, one month late. Regarding public service pensioners, the increase will take place at the end of September. Supplementary pensions will be revalued on November 1, 2022. The increase will be between 4.9% and 5.2%. Finally, basic scheme pensions will increase by 0.8% on January 1, 2023 as set out in the Social Security financing bill. Here is the full schedule:
Civil servants, employees of the private sector… This increase in pensions concerns all the basic schemes! In other words, the pension of own right, the reversion pensions, the beneficiaries of the ASPA as well as the ASI.
The successive increases in the amount of retirement pensions (1% in January 2022 and 4% in July 2022) represent a cumulative increase of around 60 euros for a retirement pension equal to 1,200 euros according to Prime Minister Elisabeth Borne who gave this figure during an interview with France Bleu on June 7, 2022.
Be careful, however, it is not the exact amount that will be displayed on your total pension since it should be remembered that this increase only concerns basic retirement pensions, excluding supplementary ones. However, the average in France for basic pensions is 704 euros according to the statement of the National Pension Insurance Fund, the CNAV. If we take this figure, the 4% gain expected this summer represents an increase of 28 euros per month. For a pension of 1,200 euros, the increase amounts to 45 euros monthly.
The amount of pensions from the basic scheme should also be reassessed from January 2023. The increase should be around 0.8%, as set out in the Social Security financing bill. It follows a first revaluation of 4% in July 2022, within the framework of the purchasing power law voted this summer by deputies and senators. The objective for the government being to index the rise in pensions to the rise in inflation, measured at 5.8% in August over one year, and which should exceed 5% on average over the whole of year 2022. Beneficiaries of the ASPA as well as the survivor’s pension are also concerned. A debate on a new anticipation of the revaluation of pensions is already planned for Parliament in mid-October, in particular due to the high inflation which should continue in the first quarter of 2023.
The overall retirement pension for civil servants consists mainly of the basic pension. A supplementary scheme, the “additional public service pension (RAFP)” also exists, but is not affected by the revaluation of retirement pensions. The increase in retirement pensions for civil servants should therefore be the same as for other employees.
