Prague, May 4 (CTK) – The Czech government might be empowered to raise pensions beyond the indexation rules defined by law if their regular rise were too low, according to a draft amendment to the pension law that the Chamber of Deputies passed on Wednesday.
The cabinet can decide to raise pensions by up to 2.7 percent at the most, says the bill which will be discussed by the Senate now.
The right-wing opposition warned that the bill may be misused by the government parties before elections.
The cabinet originally proposed a 1.7-percent limit for the government’s raising of pensions, but Prime Minister Bohuslav Sobotka’s Social Democrats (CSSD) finally pushed through a 2.7-percent cap after agreeing on it with its partners in the centre-left coalition government, ANO and the Christian Democrats (KDU-CSL).
The approved limit would enable the government to raise the monthly pensions by up to 300 crowns on average.
According to previous information, the coalition parties have agreed on a 200-crown increase in 2017.
Based on the valid indexation rules, pensions would rise by an estimated 180 crowns.
The bill was supported by 138 of 171 deputies present on Wednesday. Apart from the three government parties, it was supported by deputies for the opposition Communists (KSCM) and the Dawn movement, and several independent deputies.
Thirty deputies for the opposition TOP 09 and Civic Democrats (ODS) voted against it.
The ODS failed to push through a more extensive change to the pension calculation and indexation system, which would have mainly helped people with low pensions.
The ODS also unsuccessfully proposed that the government’s decisions to raise pensions beyond the indexation limit require consent from the lower house’s budget committee.
Based on the pension law, pensions are annually indexed as of January. Their rise is derived from the growth of prices and the real wages in the preceding period.
These indicators have been low in the past period, which is why the monthly pension rose by a mere 40 crowns on average this year. That is why the parliament approved a one-off subsidy of 1,200 crowns to pensioners for 2016.
The Czech government wielded the extra indexation power in the past, but it was scrapped by an amendment several years ago.
