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Fedea proposes linking public pensions and wages to underlying inflation

The Study Foundation for Applied Economy (Fedia) predicts that pensions—excluding those with a minimum—and public wages will increase with underlying…

By admin , in news , at May 9, 2022



The Study Foundation for Applied Economy (Fedia) predicts that pensions—excluding those with a minimum—and public wages will increase with underlying inflation in 2023 and not with the normal rate, Thus spread the cost of war in Ukraine As just as possible.

In a special issue of its bulletin, dedicated to the Ukrainian crisis and published this Monday, Fedya considers it necessary for the government negotiate a rental agreement With social agents and to avoid “an inflationary spiral that would be detrimental to all”, it is supported by political parties.

“It will be necessary that wage and pension growth be kept below general inflation”, with the possible exception of the minimum pension, and with the result of subtracting from underlying inflation or general inflation the “shock of import prices accumulated during the previous year”. ‘”, he adds to the document.

They insist to Fedya that Absence of a settlement can make inflation chronicwhich would “undermine the country’s international competitiveness and the real value of most savings.”

Measures targeted at vulnerable groups

Regarding the measures adopted by the executive, he describes as “right” those that are specific to the productive sectors most affected by rising energy prices and households with fewer resources, but emphasizes that give that it is It is “debatable” that these actions should be extended to all companies and households.

In the document the foundation explains, “Normalization of aid increases its budgetary cost, directs wastage of resources towards groups that are less affected and stimulates energy demand, to which it also adds” contributes to pushing up their prices. To increase and increase the income of Russia».

For this reason, it proposes to increase VAT collections and allocate special taxes resulting from the rise in energy prices. To compensate the groups most affected by such growth,

Regarding the temporary modification of the functioning of the Iberian electricity market, which the Spanish and Portuguese governments have negotiated with the European Commission, FEDIA acknowledges that it will allow to significantly reduce the price for many consumers and companies, but ” This considers an incentive to consume more gas”.

The document rejects other measures such as “limitations on the updating of residential rents” or “prohibition of objective dismissal for reasons not connected with war”, as they may have the opposite effect of desired.