Cameron: 40,000 million for non-contributors

Pensions: the 70,000 million breakdown cited in the thread

The thread cites a breakdown of 70,000 million euros for pensions: 40,000 million would go to those who never contributed to the system and 30,000 to those who did, according to a comparison attributed to The Objective. Half the bill, in this reading, for people who did not contribute. With this starting point, the rest of the analysis writes itself.

How much does a pensioner receive for each euro contributed?

A calculation circulating in the thread is stark: for each euro contributed, the pensioner receives 1.6 euros in pension, 60% more than contributed, according to this reading. Another message claims a participant’s father will receive 37.5% more than he contributed, with the warning that pensions were designed for a lower life expectancy than today. Some argue cases exceeding contributions are the norm, not the exception, while others note many collect for only four or five years before dying. The figure does not distinguish between those who contributed for 45 years and 15.

Contribution bases from 1980 and inflation

The counterargument comes from old figures. A user claims to have found in the Official State Gazette (BOE) that in 1980, the minimum contribution base for an engineer was 38,850 pesetas, about 233.49 euros. Updating that figure with inflation over four decades changes the comparison entirely, according to that message. For years, contributing for 15 was enough to qualify for a pension, calculated using recent bases. Those who worked 45 years did not contribute the same in 1980 as in 2020, and summing bases without adjusting fails to allow comparison, they argue. The currency is also mentioned: contributions were made in pesetas, pensions are collected in euros. This mismatch, some claim, is the true hole in the narrative.

Is a pay-as-you-go system sustainable with this demographics?

A harsh diagnosis describes it as a pyramid scheme. A participant claims a ratio of three or four contributors per pensioner is needed to sustain it, and with current birth rates, that balance is not achieved. The alternative mentioned is the Austrian backpack model, with individual accounts and basic poverty insurance. On the opposite side, it is noted that social security contributions are not just any tax and the system was designed so no one works until death. Some analysis suggests incorporating young labor is the solution; others reply this only delays the problem and adds pressure on spending.

The January payroll and the intergenerational equity mechanism

The adjustment is already underway. The January payroll will be shorter due to the intergenerational equity mechanism, according to 20minutos. The looming question is what intergenerational equity there is in current contributors financing pensions not paid to almost anyone. Each increase in retirement age or contributions shows rules change when the system does not balance, according to another message.

The fund that never existed

A recurring exercise: if that money had been put into a fund for 40 years, it would be 1,250,000 euros earning 5%, about 60,000 euros annually in pension, according to a calculation in the thread. The comparison with Norway appears: a participant claims the Nordic country gets about 30,000 euros per Norwegian from its pension fund, unthinkable here without more. Meanwhile, spending is divided among contributory pensions, non-contributory, minimum supplements, dependency care, and various bonuses, according to several messages. The separation of social security contributions from the category of taxes, some argue, is the first line of defense for the status quo.

With these figures, the question posed by the thread is not whether the system holds, but how much longer it can be stretched without changing the rules.