New regulations on pension eligibility ease thousands

The Greek government has recently enacted new regulations that significantly impact pension eligibility for thousands of insured worker heading into retirement. 

The changes apply retroactively to both pending and future retirement applications, providing relief for those burdened by debts up to 30,000 euros. 

Previously, many individuals faced challenges in receiving their pensions due to outstanding liabilities.

The key obstacle addressed by the new decree was the cross-referencing of bank deposit data. Specifically, applicants with rejected pension requests due to outstanding debts were hindered by the requirement to match their financial records with banking information. 

Following are the main provisions of the updated regulations:

1. Debt Thresholds:
   • For pension eligibility, an individual’s outstanding debts to the e-ESPA (Unified Social Security Fund) must not exceed 30,000 euros. Similarly, for former OGA members, the limit is 10,000 euros. These debts encompass various types of contributions, including insurance premiums, recognition of fictitious insurance periods, voluntary continuation of insurance, additional fees, and other charges.
   • The debt limits are now more flexible, allowing for greater relief for those seeking retirement benefits.
2. Age and Contribution Requirements:
   • Applicants must be at least 67 years old or 62 years old with a minimum of 40 years of insurance coverage (including actual, fictitious, and voluntary periods).
   • These age and contribution criteria ensure that pension recipients have a substantial work history.
3. Bank Deposits:
   • Bank deposits are now considered in the eligibility assessment. An individual’s total deposits across all accounts are taken into account.
   • The maximum deposit balance allowed is 12,000 euros in general or 6,000 euros for former OGA members.
4. Application Process:
   • The pension eligibility application is submitted alongside the regular retirement application.
   • By consenting to share their banking information, applicants allow the e-ESPA to verify their financial status.
   • The application includes a declaration of compliance with the debt and deposit limits.
5. Calculation of Excess Debt:
   • If an applicant’s outstanding debts exceed the specified thresholds,  they receive a debt notification. They have two months to settle the excess amount.
   • Failure to pay within the deadline results in the rejection of the pension application.
6. Partial Pension with Debt Deduction:
   • If an applicant’s debts fall between 20,000 euros and 30,000 euros, they can still receive a partial pension.
   • The excess debt is deducted from their monthly pension payments until fully repaid.
7. Positive Impact:
   • These regulatory changes aim to alleviate financial burdens and ensure that more insured individuals can access their pensions.
   • The Madrid model, which has also experienced housing price increases due to demand, serves as a relevant example.

by Yiorgos Pappous