Government extends benefits to parents of sick children, victims of gender-based violence and disasters

The Spanish government has recorded the largest financial shortfall in the history of the Social Security system following two pension reforms implemented since 2021. According to documents reviewed by El Mundo and submitted this month to the Court of Auditors, the Ministry of Inclusion has closed the accounts for 2025, revealing a negative net asset position of €116.1 billion. This represents the highest-ever negative balance for the Treasury of the General Social Security System (TGSS). The system continues to require loans from the state to cover pensions and other expenses, despite ongoing debates over whether all pensions should continue to be indexed to inflation. President Pedro Sánchez of the ruling PSOE party and opposition leader Alberto Núñez Feijoó of the Popular Party have both expressed willingness to support further pension increases aligned with inflation, as required by law. Neither has proposed additional measures to curb spending at this time. According to Funcas, if pensions rise by 3.6% next year, the already substantial cost will increase by another €8.4 billion, which would not be fully offset by increased contributions. Analysts such as Miguel Ángel García from Fedea and Santa Lucía estimate the increase could be closer to €17 billion when accounting for additional factors like a 1.8% rise in pensions and a 2% substitution effect. The Court of Auditors will begin its review of these figures in the coming weeks. The negative net assets indicate that the Social Security system continues to rely on state loans, a trend that has persisted over the past decade. While a private company with such a negative net asset position would technically be in insolvency, successive governments argue that the situation cannot be compared directly to a commercial entity because the state guarantees pension payments and does not seek repayment of debts if necessary. The figures represent an increase of nearly €10 billion from the previous year's total of €107.375 billion, marking an 8% rise. The latest number was revised upward by more than €1 billion compared to the initial closure two years ago due to corrections and adjustments made in the report. According to García, this new increase reflects the continued structural deficit of the system, which he estimates exceeds €60 billion, or 3.7% of GDP, despite forced contribution increases aimed at balancing the books. The Ministry of Inclusion notes that the accounting deficit has decreased to €7.352 billion in 2025, equivalent to 0.4% of GDP. However, analysts emphasize that this figure does not include substantial state contributions needed to balance the accounts. The difference between the accounting deficit and the contributory deficit is highlighted by the loan that exacerbates the negative net asset position, which exceeds the discrepancy accounted for by the ministry. García points out that while revenues have risen, expenditures have increased even more significantly. His estimation shows that the contributory deficit has grown from €32.015 billion in 2018 to €56.946 billion in 2025, reaching €61.881 billion when excluding certain factors. Separately, the government approved a package of improvements to several social security benefits for specific groups. These include expanding access to widow’s pensions for couples who are not married or registered as domestic partners but have children who can prove two years of cohabitation. Additional enhancements cover provisions for parents with seriously ill children, orphans, victims of gender-based violence, some maternity-related absences, and those affected by disasters. Minister of Social Security Elma Saiz announced these changes, emphasizing the need for better coverage of these situations. One notable change allows couples who meet the criteria to apply for a one-year window to claim their right to a widow’s pension, effective from the following month after submitting the application. Special protections have been introduced for women suffering from incapacitating conditions related to menopause and workers victimized by gender-based violence whose injuries prevent them from working. These cases will receive greater protection, including payment starting from the day of absence and higher percentages of the regular salary base. Other measures include increasing the minimum amount for orphan’s pensions to double the national minimum wage, currently set at €1,221 per month. The government also included provisions to strengthen child protection when one parent fails to pay child support after divorce or separation.