Czech Social Security Announces Pension Increase, Last Extraordinary Adjustment Expected

The Czech Social Security Administration has initiated the distribution of notifications to seniors and other pension recipients, informing them about the upcoming increase in their pensions starting in June. The average pension will be raised by 750 Czech korun, 1,000 korun less than initially planned. This adjustment is likely to be the last extraordinary increase, as future adjustments are expected to be replaced by a subsidy. Given the slowdown in inflation, additional notable adjustments are not anticipated shortly.

According to Eva Davidová, spokesperson for the Ministry of Labor and Social Affairs, another significant adjustment is highly unlikely after the April inflation value’s publication. However, if such an adjustment were to occur, it would adhere to the current rules. Although April witnessed a year-on-year inflation increase of 12.7 percent, the more crucial factor for calculating significant adjustments is the month-on-month change, which decreased by 0.2 percent.

For further increases to be warranted, inflation would need to rise by five percent when considering the accumulated months. The notifications regarding the current adjustment will be gradually distributed to clients based on the due dates of their pensions. They will be disseminated through data boxes from May 12th to May 31st, while the distribution via the Czech Post will occur from May 29th to June 20th.

The notifications provide detailed information on individual pensions, including their current amounts, the increase, and the new values. This also applies to potential pension supplements, such as those granted for injustices caused by the previous regime. It is important to note that no application is required for the automatic increase, which applies not only to old-age pensions but also to disability and survivor’s pensions. The increase amounts to 400 Czech korun and a 2.3 percent rise in the assessment basis. As per the Ministry of Labor’s calculation in March, the average old-age pension will increase to 760 Czech korun, reaching a total of 20,200 korun.

Furthermore, pensions currently set at 14,000 korun will increase by approximately 630 korun, while those at 16,000 korun will rise to around 16,680 korun. Additionally, individuals who turn 85 in June will receive an additional increase of 1,000 korun on the assessed basis. However, the government’s sudden change in the valorization formula, aimed at reducing rising pension expenses, has faced criticism.

The opposition party ANO has complained to the Constitutional Court, arguing that the amendment was submitted under legislative emergency conditions without allowing opposition lawmakers to express their views. The court will review the complaint in the coming months, and ANO hopes for a successful outcome requiring the state to supplement pensions.