Issue link: https://maltatoday.uberflip.com/i/1528842
10 maltatoday | SUNDAY • 3 NOVEMBER 2024 BUDGET2025 PENSIONERS will receive an increase of €8 per week or €416 per year, which includes the cost-of-living increase. Over 100,000 retirement, in- validity and widowed pension- ers as well as others entitled to an old-age pension will benefit from this increase. Together with the annual in- creases received by pensioners over 10 years, these increments have reached a total sum of at least €3,583, almost €70 per week. In a bid to close a loophole in Maximum Pensionable In- come between pre-1962 and post-1962 generations created as a result of the 2006 reforms, those born before 1962 and whose salary would otherwise still exceed the Maximum Pen- sionable Income of €23,500, will have a further adjustment in their pension. Some 26,000 pensioners are expected to benefit from this measure. Tax exemptions for pensioners Pensioner widows will benefit from an additional increase in their pension through the pro- cess allowing them to receive the full pension their spouse would have received if they had survived by 2027. This adjustment affects around 7,500 widows and wid- owers. The additional increase will average around €3 per week, in addition to the overall increase of €8 per week. The adjustment of bonus rates will continue over the next two years, until the end of the process in 2027 where every pensioner will be entitled to the highest rate of €21.53 per week, which will then con- tinue to be paid together with the pension and any other in- creases granted to pensioners in the future. Service pensioners will again see the amount of their service pension not taken into account for the purpose of the social security pension, increased by a further €200 to reach the sum of €3,666. Around 3,250 service pensioners will bene- fit from this move, thanks to a measure where at the age of 72, the entire amount calculat- ed from the service pension is no longer taken into account. Pensioners to receive €8 per week increase THE government will be contrib- uting up to a maximum of €100 a month for public sector workers in- vesting in an optional occupation pension plan. Finance minister Clyde Caruana said it will contribute directly as an employer, by paying as much as the individual contributes up to a max- imum of €100 per month. "This plan will benefit from the same tax incentives that exist today, both for the employer and the em- ployee," Caruana said in his speech. Those who are already in a private plan, can also join an occupation- al plan and benefit from the same schedule of tax benefits – which amount to a maximum of €750 an- nually in tax rebates. Details of the occupational plan for public sector workers will be hammered out with social partners, to roll out the occupational pension plan by mid-2025. The government's commitment to top-up its own workers' private pension payments is intended to position the government as a model employer in the hope of encourag- ing the private sector to follow suit. Nonetheless, the concept of occu- pational pensions being considered is still on a voluntary basis with no obligation on employers to pitch in. Government had in previous budgets improved tax incentives to encourage people to invest in a pri- vate pension plan. "Now is the time to strongly encourage occupational pension plans in our country. This is in the interest of workers and to have more sustainable and ade- quate pensions," Caruana said. "The ultimate intention is that every employee entering the world of work or changing jobs will have the opportunity to invest in an oc- cupational pension plan. While employers will not be obliged to contribute, they must offer their employees the opportunity to join a plan. It is up to the employee to refuse to do so." Government commits to €100 monthly top up for public sector workers who voluntary take up an occupational pension The adjustment of bonus rates will continue over the next two years, until the end of the process in 2027 where every pensioner will be entitled to the highest rate of €21.53 per week