The budget is approaching; the outlandish proposals on pensions are ready

Ahead of the budget debate, the League has already taken the field on the issue of pensions, circulating more or less the usual proposals which – according to its representatives – should “go beyond” the Fornero law and restore flexibility to the system. The League’s proposals concern the possibility of retirement at 64 years of age with 41 years’ contributions, and extending the provisions of the contribution-based scheme (64 years of age and 25 years’ contributions) to those in the mixed scheme, provided they accept that their pension is calculated entirely on a contribution-based basis (the fate of the adequacy requirement remains unclear). Overarching all this is the call to abolish the indexing of pension eligibility criteria to increases in life expectancy – a measure which not only guarantees a minimum level of sustainability for the system but also remains the sole element of solidarity with the younger generations, who are required to fund the pensions of previous generations.

Of course, it is not easy to abolish the biennial indexation mechanism. It is therefore likely that the government will proceed in stages, given that the Budget Law comes into force in 2027, an election year. It seems certain that the first step will be to repeal the provision introduced in the 2026 Budget Law concerning the increase in the state pension age by one month in 2027 and by a further two months the following year. This is a demand shared by the political left and the trade unions, as well as by sections of the ruling majority itself, based purely on the logic of deferring the matter to the government that emerges from the forthcoming elections. It is said that even long journeys always begin with a first step: not only forwards, but also backwards.

After all, the ‘friends of friends’ have already begun to lay the groundwork by spreading – based on INPS data for the first half of the year – the grim news of the reduction (reportedly 24 per cent, based on the provisional survey of 2 July) in early retirement pensions, the number of which turned out to be lower than that of old-age pensions. As regards pensions commencing in 2025, there were: 283,720 old-age pensions and 213,882 early retirement pensions; for those commencing in the first half of 2026, there were 132,039 old-age pensions and 100,356 early retirement pensions. But in a normal country, the majority of workers retire at the statutory retirement age. Where early retirement schemes are available, there are financial disincentives and very stringent age and contribution requirements. In Italy, early retirement accounts for the majority of the current pension stock, amounting to around 2 million pensions. Furthermore, the period during which the pension is received is not usually taken into account. The baby-boom generations, given the course of their working lives, have been – and remain – able to accumulate the contribution history required to retire regardless of their chronological age (42 years and 10 months for men and one year less for women) at an average retirement age of 61.7 years in 2025 and 61.4 in 2026. This means that they can receive their pension for many years, funded by future generations, who are fewer in number and less likely to have stable and continuous employment.

During the debate, another proposal emerged from INPS President Gabriele Fava, which revives an old idea put forward by his predecessor Pasquale Tridico (M5S) and is supported by Minister Marina Calderone. The idea is to automatically open a funded pension account for every newborn. The fund is initiated by an initial public contribution paid by the state. Subsequently, whilst the beneficiary is still a minor, the account would be topped up through voluntary contributions from parents and family members. Finally, once the beneficiary enters the labour market, they would be responsible for making the contribution payments themselves. The INPS has put itself forward to manage the scheme, seemingly overlooking the failure of FondInps, the fund previously tasked with administering residual severance pay. Under current legislation, it is possible to enrol dependent children (even if they are minors or infants) in a pension fund. The account is held in the child’s name, whilst the parents make the contributions and benefit from the tax advantages provided. If a public contribution for minors is to be added, so much the better. There is no need to look to Merz’s new reform in Germany, because an Italian model already exists in Trentino-Alto Adige: the regional contribution towards supplementary pensions for minors is entrusted to one of the pension funds registered on the official register and supervised by COVIP. There is neither any need nor any advantage in having the state, through INPS, handle this. To each their own role.