Minimum pensioners lose 2.5% against inflation, but the rest gain 6%

The purchasing power of the minimum retirement pension registers a fall of 2.5% between November last year and August 2024, while, to have the same level as they had in 2017, today, the benefit would have to be $400,000.

This is indicated by the Argentine Institute of Fiscal Analysis (IARAF) In a report that warns that, in order for the purchasing power of the lowest pensions in the pyramid to be maintained, inflation last month should not have exceeded 3.07%.

“The national government determined a value of $70,000 for the September bonus and completed seven months with the same amount,” explains the report that was published on the day in which the deputies are preparing to discuss President Javier Milei’s veto of the retirement mobility law.

The report states that “The pension will increase by 4%, which was the inflation rate in July” which “leads to a higher income in real terms compared to August, but, almost certainly, to a lower income for retirees who receive the minimum and the bonus.”

“Specifically, for those people who receive a bonus, since the monthly increase in income would be 3.07%, Purchasing power would improve to the extent that September inflation is equal to or less than 3.07%,” the report states.

Why minimum pocket pensions are falling

The IARAF indicates that “the retirement pension It was at its lowest in February 2024 and, from that moment on, it began to recover.”

If you take the lowest salary on the scale and add the $70,000 bonus, the regression was as follows:

• between 2017 and February 2024 the actual decline was 43%,
• Between February and August the real increase was 29%,
• Between November 2023 and August 2024, real income fell by 2.5%, given the fixed bonus of $70,000.

The report states that “the central issue of recent months is the real recovery of assets and the real drop in the bond, since it will complete seven months with the same value of $70,000.”

“This made, In June, a peak is reached and, from there, a decline has already begun. real of total income. In effect, between June and September, real income could fall by as much as 1.6%,” the report explains.

The report adds that, “if the average income of the year 2017 at today’s values, there is an amount of $400,000, the difference being in the order of $100,000 per month with the current income.”

How did the rest of the retirees fare?

The rest of the retirees fared well. In the case of the rest of the pensions, the reality is the following:

• Between 2017 and February 2024, the actual decline was 62%,
• Between February and August, the real increase was 50%,
• Between November 2023 and September 2024, the real increase would be around 6%.

How much do retirees lose compared to 2017?

Thus, the loss of retirees in the last seven years is as follows:

• It can be seen that a retiree who does not receive bonuses lost between 2017 and 2023 the equivalent of 13.7 2017 salaries.
• The accumulated loss in the first eight months of 2024 was 4 times the amount of 2017 salaries.
• This retiree, who is not currently receiving any bonuses, has lost around 17.7 times his salary in 2017 over the last seven years.
• In August 2024 pesos, the accumulated loss of someone who earns 3 times the minimum salary is $21,185,280