Revaluation of pensions in July: what part of your pension is affected?

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Retirees rejoice. As promised by the government, their pensions will be increased next July, on an exceptional basis. This is to maintain their purchasing power, which has been undermined by the incessant increase in inflation since the start of the year. The rate also shows 5.2% in May over one year, according to the latest estimates from INSEE. The increase in retirement pensions will take place during the payment scheduled for next August. As recently announced on RTL Olivier Dussopt, the Minister of Labour, “we would like this indexation to inflation to be valid for pensions for the month of July. As part of the general scheme, the pension for the month of July is paid on August 9”. This revaluation will be integrated into a broader bill on purchasing power after the legislative elections. What pensions does it concern?

The increase planned for this summer will only apply to basic pensions, apart from that of lawyers who have their own system, recalls Capital.

The state cannot intervene in supplementary pensions. However, even on basic pensions, there are significant differences between employees, self-employed and civil servants.

On the one hand, the self-employed and private employees have the same rules. The basic pension is capped at 50% of the social security ceiling. In 2022, the monthly ceiling is 3,428 euros. The basic pension cannot therefore exceed 1,714 euros. Thus, if a former private sector employee receives a global pension (all plans combined) of €3,000, only the €1,714 of his pension can be revalued in July. As a result, the higher your pension, the lower the portion of your pension that will be revalued.

What about civil servants?

The civil servants’ basic pension constitutes the vast majority of their overall pension. There is simply a complementary scheme called additional public service pension (RAFP). Introduced in 2005, it concerns only a maximum of 20% of the amount of the gross annual salary.

The exceptional revaluation of July will therefore be more substantial for civil servants.

What about the level of revaluation for all retirees? Could it be differentiated?

In 2020, the executive introduced a differentiated pension revaluation. Retirees who received less than 2,000 euros gross (all plans combined) benefited from an increase of 1%, against 0.3% for the others. Will it be the same this year?

Finally, the level of revaluation is not yet known. It should follow the level of inflation, but we do not yet know which indicator will be used. Recently, the Minister of Labor mentioned this: “If we take into account inflation at 4%, for a pension of 1,200 euros, it is a gain of 45 euros per month.”