This is when pensions are expected to increase this year, the economic expert clarifies the last details and shows that the figures will be higher for pensioners compared to 2021

The economy expert, Romina Radoshiq, has spoken about the vital minimum, which is still unapproved in Albania. Radoši? says the approval is a must as the cost of living is very high in the country and incomes are the lowest in the region. By reducing informality and fiscal evasion by administration employees, the expert says that this makes it easier for the government to approve the minimum wage. On the other hand, Radoši? gives the news about when the pensions will increase. According to her, the indexation of pensions expected in October for this year is expected to be higher compared to the indexation of 2021.

- Why do you think that the living minimum has not been approved until today, was it due to the fact of the lack of political will or because of the high costs of the approval of the minimum?

I don't think it was a matter of lack of political will as this would be a very strong weapon where it would give more credit to the political parties, but the point is that it is very easy for any individual to talk about why it is not defined. Although in Albania it is necessary to determine the living minimum since living costs are much higher than income. The reason why it has not been determined yet is the fact that the minimum living wage would cost the state budget a lot, and on the other hand, it is also costing the state the removal or the problems of the ISSH scheme, where the Ministry of Finance itself is financing this scheme. If we were to define the vital mine, it would be costly to the state, where as a result it would sacrifice investments or taxpayers by increasing taxes. The minimum living wage must be determined with policy makers and experts in the field to look at costs and benefits, and be a real, not fictitious determination. The cost of living is high as in Europe, but our incomes are lower than in the Balkans. Undoubtedly, the government has opportunities to take advantage to intervene to determine the minimum living wage, it is enough to fight fiscal evasion and informality since the money is there.

-But this is not an easy battle?

Undoubtedly, but if the work is done willingly and the administration employees will be so correct that they will take the task seriously, I think it will be many times easier and we will have a reduction in informality and fiscal evasion .

-From the proposal made by DP that the minimum living wage be up to 200 euros, is this money enough to cover the monthly expenses of a pensioner?

I don't think it's an affordable value, but the two biggest crises in the country, like the pandemic and the war, have influenced the minimum wage to be higher. But it is better if it is 200,000 lek than not at all. Taking into account an average pension of 180 thousand ALL per month, with this income the pensioner can only cover 60% of monthly expenses, such as food, clothing, electricity, entertainment, thirst; and the rest of the expenses are covered by the children through remittances.

- What is expected to happen with pensions in October when the indexation is expected to take place, how much is the increase expected to be?

The increase, based on the inflation rate, will not be very high. We will be slightly higher than the values ??of 2019 or 2020, but it will not be an indexation as we would like it to be, for example; over 8%. I think it will be as much as half of it or that the indexation will be higher than in 2021, it will be, but how fixed this will be remains to be seen. We have seen that in the last 6 months we have a significant decrease in inflation, which on the one hand is good news for us citizens because it is good that prices have decreased, but not very good news for pensioners since they are waiting for the indexation of their pensions. . The good news is the fact that from 2015 until now we have had indexation and if the pension scheme were still more consolidated the indexation would be even higher but the government no longer has the opportunity to finance the pension scheme so much. , since the contribution ratio has also decreased, so the pension scheme is even more problematic.

-Therefore, an assessment process has been started for the current scheme, to enable intervention in the pension scheme, to make it a healthy scheme in financial terms and to give pensioners the opportunity to have a more dignified benefit measure for afford the monthly expenses?

For the level of pensions, we are ranked as the country with the lowest pensions, this is also a consequence of the high cost of living. Even for salaries and pension levels, we are lower compared to the countries of the region, but our living costs are really high.