Following a raft of analyses by a commission of experts and multiple talks between representatives of employer and employee organisations (the ‘social partners’), the legislation to raise the statutory retirement age has passed and was incorporated into the Law of 10 August 2015 (it was published in the official gazette on 21 August 2015 – hereinafter the ‘Law’).
The law (i) not only raises the statutory age at which workers can draw their state pensions, (ii) it has also inter alia tightened the conditions for being able to take early retirement and (iii) and raised the minimum age for claiming a survivor’s pension.
The measures deal with the three statutory pension schemes (salaried workers, the self-employed and the public sector).
In this article, we only look at the provisions applying to salaried workers.
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State retirement pension
The statutory retirement age is currently 65. The 65th birthday threshold is retained until 31 December 2024 and will then rise to age 66 in 2025 and 67 in 2030:
Pensions actually kicking in for the first time …
Minimum legal age
... no later than 1 January 2025
65
… no earlier than 1 February 2025 and no later than 1 January 2030
66
… no earlier than 1 February 2030
67
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Early retirement pension
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Principle
Workers wanting to claim their pension before the legal retirement age can still take early retirement.
However, the law raising the legal pensionable age tightens the conditions for accessing the early pension scheme.
Up until 1 December 2012, the age and working-life conditions were set at 60 and 35 years, respectively.
In the last parliament, the Di Rupo government issued rules gradually raising these conditions between 2013 and 2016 to age 62 and a working life of 40 years as of 1 January 2016 (with exceptions for long working lives).
The Michel administration’s reform has now been grafted onto the previous one and extends the timetable from 2017 up to 2019. From 1 January 2019, the age condition is now 63 and the working-life condition is 42 years.
Along the lines of the measures issued under the Di Rupo administration, exceptions for very long working lives are again factored in so as not to penalise those who started work at a young age and can prove they’ve had a long working life.
All in all, the conditions for accessing early pension between now and 2019 are as follows:
For pensions actually kicking in for the first time no earlier than …*
Minimum age
Working-life condition
Exceptions for very long working lives
… between 1 January 2015 and 1 December 2015
61 years and 6 months
40
60 if working life of 41 years
… between 1 January 2016 and 1 December 2016
62
40 years
60 if working life of 42 years
61 if working life of 41 years
… between 1 January 2017 and 1 December 2017
62 years and 6 month
41 years
60 if working life of 43 years
61 if working life of 42 years
… between 1 January 2018 and 1 December 2018
63
41 years
60 if working life of 43 years
61 if working life of 42 years
… as from 1 January 2019
63
42 years
60 if working life of 44 years
61 if working life of 43 years
* As regards pensions commencing during the month of January, the age and working-life conditions applying in the preceding year apply.
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Ratchet system
Workers who meet the then applicable conditions for taking early pension will “ratchet” that right for the future, even if they retire later.
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Exceptions
The Law lays down a series of transitional exceptions to the age and working-life conditions for taking early retirement, which come on top of hose already enacted under the Act of 28 December 2011 and its implementing decree of 26 April 2012 (see appendix).
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Survivor’s pension
Parallel to raising the statutory retirement age, the new law continues with a programme of reforming survivors’ pensions.
The qualifying age for a survivor’s pension (the claimant’s age at the time of the spouse’s death) will rise gradually to 50 as of 2025 and 55 from 2030.
Those not qualifying for a survivor’s pension can still claim under the transitional allowances scheme operated by the National Employment Office.
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NPO portal
To inform employees on their post-reform pension rights (the date when workers can take pension, and how much that will be), the National Pensions Office is planning developing its online portal (www.mypension.be) by the end of 2017 at the latest.
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Trade union disinformation?
The Pensions Minister has, to a certain extent, criticised the “trade union disinformation” which, he says, claims that all workers will have to work to age 67 and that pensions will be reduced.
The minister rebuts this disinformation as not only untrue – he says workers will work an average of one or three years extra – but as also creating anxiety at a time when the pension reforms are unavoidable, since it had ultimately become mathematically unviable to fund the pensions system due to increasing ageing of the population (life expectancy having risen by 23 years since the inception of the pensions system!) and a fall in people’s working careers (with the average worker quitting work at age 59 in Belgium, against a European average of 63½ and a lower employment rate between ages 60 and 64).
The Belgian government felt that it, along with all nations in Europe (except France), was constrained to take the measures needed to catch up with the European average of 63½.
The statute published on 21 August is a first step towards the pension reform that is required.
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What next?
The reform now needs future refinement in that it seeks to increase the average working life but cannot rule out early retirement by workers who have health problems or don’t have the aptitude to continue working.
The next priority areas for the government to work on before broaching the institution of a more wide-sweeping reform of points-based pensions are therefore to set up a partial pension scheme and the issue of work hardship.
Partial pensions will allow workers to gradually quit the labour market while allowing employers to still benefit from their experience, while reducing cost.
The issue of work hardship has been referred to the social partners, notably the National Pensions Committee, which has been given the tricky task of setting the criteria for onerous trades.
One thing is certain: the reform will miss its mark if there isn’t worker solidarity, because to enable those who simply cannot go on or are in truly onerous trades to retire earlier, those in good health will have to accept the fact that they’ll have to work longer.
