Gov't Raises Pensions 15% From January

Government

Prime Minister Viktor Orbán signed a decree on Tuesday raising pensions by 15% from January 1, according to a report by state news wire MTI.

"Hungary has big goals that go beyond difficult times. One such big goal of ours is to ensure pensioners a decent living and to preserve the value of pensions," Orbán said in a video message posted on Facebook.

"We have achieved that goal every year since 2010. Now that we're raising pensions by 15% from January 1, we're doing the same in 2023," he added.

 For years, Hungary's government has adjusted pensions to the expected rate of inflation at the start of the year. However, if CPI is higher than expected, it tops up pensions to match the difference, retroactively.

This year, pensions were raised 5% in January, in line with a CPI forecast by the National Bank of Hungary (MNB), but topped up again by 3.9% in July and 4.5% in November as inflation exceeded expectations.

January-November inflation was 13.6% year-on-year, the latest data published by the Central Statistical Office (KSH) show.

MNB will release its next quarterly inflation forecast in one week. The central bank's latest forecast, published in September, put average annual inflation at 11.5%-14% for 2023.

In a post on Facebook on Tuesday, Finance Minister Mihály Varga said pension payments would add up to HUF 6.15 trillion next year. The amount includes an annual bonus, equivalent to a full month's pension, to be paid in February, he added.

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