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Hungarian pensioners received bad news

Hungarian pensioners received bad news

This was the week in which the government realized to the public that the originally expected 4% growth for this year was no longer realistic. According to an announcement by Finance Minister Mihály Varga, the Hungarian economy may grow by 2.5% this year, and the Ministry of National Economy confirmed that it is counting on this growth.

This has an important direct consequence for pensioners: There will be no retirement bonus this year.

There are clear and unambiguous rules for this. If the economy grows by more than 3.5%, the government must pay a pension premium. He pointed out that if the economy grows by 2.5%, it is less than the growth of 3.5%, indicating that there is a small chance that the government will pay a pension premium to the elderly this year.

The government has already planned for this in the budget 20.5 billion forints were allocated for this purpose. The draft text specifically states that pensioners are expected to receive a retirement installment in November.

When asked about the fate of this frame, Mihaly Varga answered, Don't worry, that money will still have a place.

More recently, in January this year, we presented what the pension premium payment would mean for pensioners this year (a one-time payment would mean a maximum of 2,000 HUF with an expected growth of 3.6% at that time, and 10,000 HUF). If growth is achieved by 4%. Next, retirement expert Andras Farkas wrote a separate analysis of how happier retirees will be as a result of this year's benefits.

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At that time, the expert also pointed out that after allocating 20.5 billion forints in the 2024 budget to cover the payment of the pension premium, in principle, there would be funds up to this amount to pay the pension premium much higher than the amount calculated according to the conditions:

  • If we anticipate this budget allocation of 2 million pensioners as eligible, a premium of 10,000 Hungarian forints could be paid per person.
  • If we also take into account beneficiaries of other benefits that qualify for the same one-time benefit as the pension premium, i.e. an expectation of a credit of HUF 20.5 billion on 2.5 million beneficiaries, a premium of HUF 8,000 per person will be paid.

The specialist also formulated a proposal: in the spirit of solidarity It would be more appropriate and correct to distribute it to pensioners who are truly in need.

Cover image source: Getty Images

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