September pensions to rise 3% under current law; payments due in October

The Fund for Pension and Disability Insurance (PIOM) has confirmed that September pensions will be increased by three percent and paid in October, with the rise applied proportionally rather than as a flat sum.

The final amount for each pensioner will be calculated individually, based on current entitlements. PIOM says it is already running the calculations so payments can be prepared on time. The next statutory adjustment is scheduled for March next year.

How the adjustment is calculated

Under the law, pensions are adjusted twice a year, in March and September. The formula combines 50 percent of the rise in the cost of living and 50 percent of the growth in the average paid net wage in the first half of the year compared with the previous six months.

In the past two years pensions were increased by flat (linear) raises on four occasions; each pensioner received a total increase of 7 000 denars regardless of the previous pension amount. The Constitutional Court opened a review of that linear increase last year but in March this year suspended the procedure because the proposal to assess the constitutionality of Article 2 of the 2025 amendments to the Law on Pension and Disability Insurance did not receive a majority of the constitutional judges. The Court concluded the linear increase is not unconstitutional.

A working group made up of representatives from the Ministries of Labour and Social Policy and Finance, PAPAS and PIOM is preparing legislative changes intended as part of a pension-system reform. The first amendment on the agenda is the purchase of missing pension years; other measures under consideration cover multi-fund arrangements, contributions, and family pensions.

Speaking in an interview broadcast on MRT 1 on 14 September, Minister for Labour, Social Policy, Demography and Youth Gjoko Velkovski described the debate over the second pillar as a possible "reconstruction" rather than abolition and said the options will be examined by the formed working groups. He said: "The option that, as the debate opened, I think in the last month and a half, we have given answers, both the Government on several occasions and we as the responsible ministry, is that it is necessary to examine this system. A review should be carried out, and for that purpose certain working groups and bodies were formed that should conduct an analysis to see, with today's parameters, what saving in the second pillar means, i.e. what the returns for future pensioners who will retire in the years to come would be." He also announced plans to introduce multi-funds with growth, balanced and conservative portfolios depending on age and the insured person's choice.

Photo: Arhiva