The single pension fund "has mutualized" the "wide" income differences by CCAA, according to Fedea

MADRID, 4 Dic. (EUROPA PRESS) -

The Foundation for Applied Economics Studies (Fedea) has prepared a work in which it highlights that the functioning of Social Security under the single fund criterion "has allowed the mutualization of the wide and deep territorial differences in income, employment and aging of the population in the autonomous communities", thanks to State transfers, supported by the general taxes of the common regime territories, and by the issuance of public debt.

The study, carried out by Miguel Ángel García, calculates the balance of the contributory component of the Social Security system by CCAA and is broken down into several factors that include the impact of demographics and the average amount of pensions and contributions. The calculations are made with data from 2021, which is the last year for which all the necessary information is available.

According to this work, Social Security "plays a preeminent role in territorial cohesion in Spain" by providing equal benefits for all people who meet the same access conditions, regardless of their place of residence.

This task, Fedea points out, has been accompanied by a "progressive deterioration" of Social Security finances, as reflected by the deficit obtained in 2021 in its contributory component, which amounts to 33,374 million euros, 2.8% of the GDP.

According to this study, in 2021 all communities presented a deficit for this concept, with the exception of the Balearic Islands and the autonomous cities of Ceuta and Melilla, which reached a slight positive balance.

The coverage rates of the contributory pension system, that is, the quotient between the net income from contributions (after deducting spending on other contributory benefits) and other income from the system (but without transfers from the State) and spending on pensions, "It varies enormously" between communities around a national average of 0.77, notes Fedea.

In this sense, the communities of Asturias (0.42), Galicia (0.57), Cantabria (0.60), the Basque Country (0.60), Castilla y León (0.61), Extremadura (0.62 ), Aragón (0.73) and Andalusia (0.73) show a coverage rate below the national average. All of them, with the exception of the Basque Country, have a per capita income lower than the state average.

"Thus, the contributory component of Social Security allows an intense process of territorial redistribution of income in Spain, although it is not always carried out in favor of the autonomous communities with lower income," the study highlights.

Fedea warns of the risk of deterioration in the balance of the contributory component of Social Security derived from the aging of the population and the "reduced" growth in productivity, with a different impact on the autonomous communities.

"During the coming decades, the whole of Spain will look more and more like Asturias, which is currently the region with the greatest weight of the population aged 65 or over in the total population and the lowest number of members of the Security Social per person over 65 years of age. The effect on the financial situation of the system will be very negative," he warns.

As a reference, Fedea points out that if the national coverage rate had been equal to the Asturian rate in 2021, the total contributory deficit of the pension system would have increased by around 50,000 million euros, to just over 84,000 million.