Estonian Center Party seeking extraordinary pension hike

TALLINN - The parliamentary group of the Estonian Center Party submitted a bill seeking to increase pensions by 50 euros in the following four years in addition to indexation.

The purpose of the bill is to increase the economic well-being of elderly people and reduce the number of elderly people living in relative poverty.

Former minister of social affairs Jaak Aab, who handed over the bill, said that the new government has completely forgotten about pensioners and added that their livelihoods will worsen even more under the conditions of the planned tax increases.

"During a speech in front of the Riigikogu, prime minister candidate Kaja Kallas confirmed that the new government has no plans for an extraordinary pension increase within four years. This is a big mistake, but it once again confirms the previous knowledge that only the Center Party cares about the elderly," Aab said.

"High inflation has put pensioners living in Estonia in a situation where it is not possible to live decently on the current income. The pension increases so far mitigate the effect of inflation, but in reality they do not contribute to improving the lives of pensioners," he added.

The income inequality of old-age pension recipients compared to other residents is high and the relative poverty rate of old-age pensioners living alone is significantly higher than that of others. According to Statistics Estonia, in 2021, nearly 60 percent of old-age pensioners lived below the relative poverty line, the relative poverty rate of people aged 65 and older living alone reaches 82 percent.

"During the elections, the Reform Party promised to increase the average old-age pension to 1,000 and the Social Democratic Party (SDE) to 1,200 euros, but there was no mention of a pension increase in the Estonia 200 program. In light of recent events, it is not surprising that the pension increase is not reflected in the coalition agreement, but this means that the promises made in the elections are yet another lie. By relying only on indexation, the average old-age pension is projected to rise to 836 euros by 2026. In order for pensioners to be able to cope with the current changed situation and the price rally, it is necessary to increase the average old-age pension to at least 1,000 euros," Aab said.

According to Aab, from 2004 until today, pensions have been raised seven times, and six times the Center Party has been the decision-maker.