Announced by the government, the increase in pensions will take effect on January 1. With an adjustment of half of inflation from the start of the year, a complete catch-up is planned in July for the most modest pensions. The Budget Minister describes this decision as a “compromise” and justifies a budgetary effort which could amount to up to 800 million euros.
An increase in pensions in the face of inflation
The government has confirmed the increase in all retirement pensions from January 1, 2025, thus meeting the expectations of retirees in the face of the rising cost of living. According to Laurent Saint Martin, Minister of the Budget, this initial revaluation will be equivalent to half of inflation.
However, a full adjustment is planned for July 1 for retirees receiving less than the minimum wage, in order to guarantee their protection against the erosion of purchasing power.
This announcement follows a statement by the president of the Republican Right group in the National Assembly, Laurent Wauquiez, who had taken certain members of the government by surprise by unveiling these measures in advance. Laurent Saint Martin, guest on France 2insisted on the need to preserve a method of consultation with the majority coalition, recalling that this decision is the result of discussions between the government and the parliamentarians of the majority group.
A significant budgetary cost
The minister affirmed that “ we need more to show that the evolution of this text comes from compromises between the government and the parliamentarians of the majority base ».
The application of this revaluation represents an estimated cost of between 500 and 800 million euros for public finances.a figure which will depend on the real evolution of inflation in the months to come. For Laurent Saint Martin, this expense, although substantial, is justified by the State’s commitment to the most vulnerable retirees. In order to reduce the impact on the budget, the Minister of the Budget is considering the merger of several public bodies and the rationalization of administrative structures. “ We have increased the number of agencies and operators; we will have to rationalize “, he explained.
At the same time, the government wishes to respond to the concerns of entrepreneurs regarding the 2025 Budget. Indeed, several business leaders fear a reduction in their investment capacity due to increased costs. Saint Martin indicated that he will follow the discussions with the deputies of the Republican Right, in order to work on measures to reduce charges, aimed at supporting companies in their investment projects.
