Rewritten Title: New Pension Benchmark Set at 32 Million Tomans as Government Pursues Income Alignment Plan
Article:
In a significant development for national social welfare policy, a new standard for pension calculations has been announced, with the household subsistence basket now set at 32 million tomans. This move is part of the ongoing, systematic implementation of the government’s pension alignment plan, designed to bolster the financial security of the nation’s retirees.
Phased Implementation of the Pension Alignment Plan
According to Ali Dehghan Kia, Head of the Tehran Social Security Retirees’ Association, the government’s plan to align pensions with current economic realities is proceeding as legislated. The first two phases of the plan, mandated by the 7th Development Plan, have already been executed, delivering increases of 40% and 30% respectively. A third phase is scheduled for the upcoming Iranian calendar year (1405), with funding to be secured by the Social Security Organization and the government.
The core objective of this strategic plan is to adjust average pension payouts to reach approximately 90% of the average salary of equivalent active workers, a crucial step in enhancing retirees’ living standards.
Bridging the Income Gap
While the alignment plan is on track, Dehghan Kia highlighted a current challenge: the minimum pension received by many retirees covers only about one-third of the total household subsistence costs. This significant gap means that a substantial portion of essential living expenses remains uncovered, creating economic pressure.
“To bridge this gap, some pensioners have had to re-enter the workforce,” Dehghan Kia noted, adding that even with this extra effort, covering all costs remains difficult for many.
A Proposed Solution: Basing Wages on the Subsistence Basket
To address this structural issue, the Retirees’ Association has formally proposed to the Supreme Labor Council that the legally recognized household subsistence basket be used as the foundation for determining the minimum wage and, by extension, pensions. This proposal leverages existing labor law, which allows for such a measure when official inflation rates are deemed insufficient to cover actual living costs.
“The implementation of this proposal can substantially reduce the gap between pension income and real living expenses,” Dehghan Kia emphasized. “We project it could resolve the existing income disparity within three to five years.”
A Broader Commitment to Social Welfare
The official further underscored the importance of supporting fixed-income and low-earning groups amidst broader economic conditions. The combination of the multi-phase pension alignment plan, supportive government programs, and the proposed shift to a subsistence-based calculation is presented as a comprehensive strategy to improve the welfare of retirees and ensure social stability.
