The improvement in employment continues to boost revenue from Social Security contributions. Specifically, in the first seven months of the year, there has been an increase of 8.6% to 80,762 million (6,377 million more than a year earlier).
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Compared with the data for the last financial year that was not affected by the pandemic, 2019, the increase in contributions is 12.6% (9,016 million euros more). In this way, the growth in revenue from social security contributions reached its highest level in the last 15 years, in the cumulative January-July period.
Thus, the growth in contributions is 2.1 percentage points higher than the increase in pension expenditure in the January-July period, thereby helping to reduce the system’s deficit. Overall, the Social Security accounts show a positive balance, on 31 July 2022, of 762 million euros. This figure is obtained from the difference between recognised rights from non-financial operations of 108,448 million euros, which shows an increase of 7.6%, and recognised obligations of 107,686 million euros, which are up 3.8% year-on-year.
In cash terms, the system’s net revenue amounted to 107,231 million euros, up 11.9% from the previous year.
Non-financial revenue
In these seven months, social security contributions amounted to 80,762 million euros, an increase of 8.6% with respect to revenue for the same period in 2021 (6,377 million euros more).
This increase is driven by the evolution of revenue from employee contributions, which increased by 9.9% year-on-year to 75,914 million euros (6,833 million euros more), while contributions from the unemployed fell by 8.6% (456 million euros less) as a result of the decrease in the number of unemployed.
Transfers received by Social Security amounted to 26.95 billion euros, an increase of 4.3% year on year. The most significant item corresponds to transfers received from the State and Autonomous Organisations, totalling 24,083 million (up 3.3%). This increase is mainly due to the transfers received from the State to comply with the first recommendation of the Toledo Pact 2020 (1,308 million euros more).
Non-financial expenditure
On the expenditure side, economic benefits to families and institutions reached 101,304 million, 4.4% more than in the same period of 2021. This figure represents 94.1% of the total expenditure made in the Social Security system.
The largest item, 93,106 million, corresponds to pensions and contributory benefits, with an increase of 4.3%.
In a detailed analysis of the contributory area, spending on pensions (permanent disability, retirement, widowhood, orphanhood and in favour of family members) increased by 6.5% to 82,529 million euros, due to the increase in the number of pensioners (0.8%), the rise in the average pension (5.5%), as well as the general revaluation of 2.5% for contributory pensions in compliance with the new law, which guarantees the purchasing power of pensions.
With regard to temporary incapacity benefits, total expenditure increased by 8.2% compared to the same period last year, reaching 7,799 million euros, while benefits for childbirth and childcare, co-responsibility in infant care, risk during pregnancy and breastfeeding and care of minors affected by cancer or other illnesses increased year-on-year by 13.7%, reaching 2,157 million euros.
Pensions and non-contributory benefits, including minimum supplements to contributory pensions, amounted to 8,198 million euros, 6.6% more than in the same period of the previous year, due to the general revaluation of 3% for minimum and non-contributory pensions.
Of this amount, 5,508 million euros (3.3% more) is allocated to non-contributory pensions and minimum supplements, and 2,690 million euros to subsidies and other benefits, of which 2,541 million euros correspond to Minimum Vital Income and family benefits, 14.5% more than the previous year, mainly due to the transitional increase of 15% in the amount of the minimum vital income that has been applied since April.