Sunday, March 10, 2019

Quotes rise this year to compensate for the slowdown in employment

Quotes rise this year to compensate for the slowdown in employment



The Government trusts to collect 8,600 million more, to a large extent by increments in the quotas and not so much by adding new affiliates



  The Government had already calculated that the creation of employment in 2019 will slow down, around one point less when going from a rate of 3% last year to another "close" to 2%, as reflected in the draft Budgets (PGE) presented three weeks ago in Congress. Thus, its forecasts are that during this year some 380,000 jobs will be created, although various institutions believe that it will be even less. However, their estimates of collection for social security contributions are more optimistic: they calculate an increase of 7.5% in the income of the coffers of the system -with an annual deficit of some 19,000 million euros-, which is more than 8,600 millions of additional euros, as long as the accounts go ahead.

  But where does this injection of money come from then? For the most part it will come from an increase in the fees paid and, more specifically, from the contributions of atypical jobs, since the conventional labor market will evolve with less intensity.

This was recognized this week by the Secretary of State for Social Security, Octavio Granado, who a few days ago admitted that the Government wants Spanish businessmen to pay higher fees. "We had calculated that the creation of employment was going to slow down, so more than 45% of the new income from social contributions will come from people who were quoting from atypical positions," admitted Granado, pointing out that he spoke of the unemployed over 52 years of age. family caregivers, people who had to pay more because they were going to retire early, etcetera.

This higher collection also comes the rise of the Minimum Interprofessional Salary (SMI), which in turn raises the minimum contribution base. And we must not forget the increase of the maximum bases, the new system of the self-employed ... among other measures that are analyzed below, some already in force and others pending of the Budgets, if they finally go ahead.

Rise of the contribution bases
The minimum contribution base for Social Security has risen by 22.3% in January, the highest increase in the last four decades, amounting to 1,050 euros per month compared to 858 euros in 2018. It will affect close to 1.5 million workers, not the self-employed, and it is expected to raise about 1,300 million euros. For its part, the maximum contribution base is increased by 7% to 4,070 euros per month, which will impact another million and a half affiliates, who will pay 266 euros more and will involve an extra 850 million, as contemplated by the PGE.

Changes for the self-employed
The minimum contribution base for the self-employed rises 1.25%, but at the same time the rates increase up to 30%, when the obligatory nature of the contributions for cessation of activity and training is established. In this way, they will have to pay at least 5.3 euros more per month, 64 euros per year. The flat rate is also increased, which goes from 50 euros to 60 euros. This will be the case until the new system comes into force by real income. The RETA this year plans to enter 66 million more than in 2018.

Subsidy for over 52 years
The unemployment subsidy is extended for workers between 52 and 55 years, and the contribution base is increased from 100% to 125% of the minimum base. Currently, almost 270,000 unemployed people over 55 receive this help and it is estimated that, with the new conditions, it could be extended to 114,000 more unemployed. This will mean an outlay of 330 million this year, which will go to the coffers of Social Security.

Financing of carers
Funding by the State of the contribution of non-professional carers of people in a situation of dependency is recovered, a measure that will benefit some 180,000 people, especially women, and which will have an economic impact of 315 million euros. In turn, the unemployment benefit is recovered in the contracts for training and apprenticeships signed with working students in public employment and training programs, including the programs of workshop schools, job centers and employment workshops.

The scholarship holders are obliged to pay contributions
All scholarship holders will have to pay Social Security contributions, even those students who are engaged in unpaid work experience - until now it only affected those who were paid for it. This was approved by the Government in the Royal Decree of December 28, although it is not clear whether it is the companies or educational institutions that will have to pay a monthly fee of about 50 euros, something that has raised a cloud of criticism because it will mean a decrease of the number of practices offered. The Executive trusts to collect around 50 or 70 million for this measure, which affects half a million students.

Improvements for household employees

The contribution bases of the domestic employees are established in terms of ten salary brackets, starting at 240 euros per month compared to 196 euros in 2018, and leaving the last section for the real salary received. In turn, the transitory period is reduced to match the General Regime.

Penalty to short contracts
The surcharge for the business rate of short-term contracts, those that are five days or less, will go from 36% to 40%. And it is that the jobs of less than a week have skyrocketed with the crisis and currently account for one in four new contracts (26%), while ten years ago they represented 15%.

Surcharge for municipal and ertzainas
The local police can retire at 59 years, but for this they will have to pay an additional 10.6%, something for which the Government trusts to enter 254 million. For their part, the ertzainas, who had already recognized this right, are forced to pay 9.9% more.

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