Final Phase of Pension Adjustment Arrives: Government Continues Support for Retirees
Tehran – The Social Security Organization has successfully implemented the first two phases of its pension harmonization plan in the past two years, with a final, decisive phase scheduled for the upcoming year as confirmed by President Masoud Pezeshkian. This structured initiative underscores the government’s ongoing commitment to improving the welfare of the nation’s retirees.
A Plan on Track
The pension adjustment scheme, a key component of the country’s 7th Development Plan, has so far been executed according to its approved schedule. The initial two phases have delivered increases of 40% and 30% respectively to pensioners and beneficiaries. Officials have confirmed that the file for these adjustments is now closed for those years, with all attention focused on preparing for the third and final phase in the next Iranian calendar year (1405).
Ali Dehghankia, Head of the Tehran Social Security Retirees’ Association, acknowledged that the plan has been implemented as legislated. However, he highlighted a significant challenge: the current minimum pension only covers approximately one-third of a household’s living expenses. This gap, he notes, makes daily life extremely difficult for many, with some retirees forced to seek secondary employment to make ends meet.
Bridging the Income Gap
The core objective of the harmonization plan is to elevate the average pension to nearly 90% of the average salary of equivalent active workers. While the plan is progressing, the immediate concern revolves around the calculation of the annual minimum wage and pension.
Mr. Dehghankia’s association has formally proposed to the Supreme Labor Council that the baseline for determining the minimum wage should be the household subsistence basket, as stipulated in the Labor Law. This is suggested as an alternative when the official central bank inflation rate does not sufficiently address the actual living costs of the people. Adopting this formula, he argues, would be a crucial step in systematically closing the two-thirds income gap faced by minimum-wage pensioners over a defined period, such as three to five years.
A Broader Economic Context
The discussion around pensions is set against a broader economic backdrop. Dehghankia pointed out that the difficult conditions affect all wage-earners, with even young workers showing less motivation for minimum-wage jobs that cannot cover their basic needs. Many employed individuals are seeking second jobs to supplement their income.
In this climate, the final phase of the pension adjustment, coupled with a potential recalibration of the minimum wage calculation, is seen as a vital measure to provide relief and stability for retirees who have dedicated their lives to the nation’s workforce. The government’s continued pursuit of this plan signals its focus on addressing these complex socio-economic challenges.