The report accompanying the state budget proposal for 2021 (OE2021) predicts that the FEFSS will reach € 22.2 billion next year, which means that, said Minister Ana Mendes Godinho, the system has a “cushion that guarantees that, in scenarios of total lack of other sources of income,” installments have been paid for 20 months “.
Minister of Labor, Solidarity and Social Security Ana Mendes Godinho, who is heard in the Budget and Finance Commission, in the context of the evaluation, in general, of the State budget proposal for 2021 (OE2021), also stated that corresponds to eight billion euros more than in 2015 and is equivalent to 10.6% of the Gross Domestic Product (GDP), “which is the highest value in terms of the evolution of the Social Security Financial Stabilization Fund [FEFSS]”.
These values were cited by Ana Mendes Godinho in response to questions from MEPs from various parties such as Inês Sousa Real (PAN) or João Cotrim de Figueiredo (Liberal Initiative), who expressed concern about the sustainability of the system in the face of diminished revenues and increased spending that the system is facing, due to the economic and social impact of the pandemic.
The issue was also mentioned by the deputy of the PS Tiago Barbosa Ribeiro, who asked the minister to respond to the “speech of fear” of those who defend the privatization of the system.
In response, Ana Mendes Godinho also said that the first negative system balances associated with the reported projections will occur at the end of the decade of 2020, “which means, in practice, a similar scenario” to what existed for 2018 and 2019. .
This forecast of the first negative balances, he also said, represents a 13-year improvement compared to OE2015, while the depletion of FEFSS means a 17-year improvement compared to the scenario recorded in OE2015.
“In each of the situations, we have projections similar to those we had in 2018 and 2019”, he said, stating that this is also due to the “capacity for evolution of the FEFSS in recent years” and the increase in revenues due to the growth of the occupation until earlier this year.
The FEFSS acts as a financial security “cushion” that the state uses in the event of a financial breakdown and has been covered in recent years with new sources of funding from the IMI surtax and a portion of the IRC revenue.
In 2021, exceptionally and due to the effects of the pandemic, these two sources of income will not be fed into the FEFSS, being allocated to the pension budget.