A relationship in discord: the maximum contribution basis and the limit on public pensions

Abstract

This article contains a study of the evolution from the maximum contribution basis and the limit on public pensions with the objective of a cuantitative analysis, and through a case study, the repercussions that the different evolution of these two scales has caused and will cause on the pensions to be received by Social Security beneficiaries. This analysis has taken into account the modifications introduced by the Law 27/2011, from 1 August 2011, regarding the updating, adjusting and modernizing of the Social Security system, in accordance with the content of the additional regulations.

In addition, it is shown which amounts these two essential scales would reach in the current Social Security system if their behaviour had been the same as seen in other scales of economic order, such as the consumer price index, gross domestic product, and wage cost, analyzing their influence on the Social Security accounts.