Until when will the deterioration of retirement and pensions continue?

With the presidential veto confirmed, the deterioration of minimum-income retirement and pension benefits for nearly 5 million people has not yet reached its limit, with the bonus frozen since March 2024. Every month, these retirees and pensioners receive less than inflation , while the repeal of the moratorium means that many—especially women— will not be able to retire , even if they are of the minimum age. And the adjustment for inflation alone perpetuates the enormous accumulated decline because the entire system's income remains constant in real terms.

Meanwhile, favorable rulings for retirees (many rulings are more than 10 years old) are being issued ordering compensation for their losses. ANSeS appealed these rulings, but the Supreme Court has yet to issue a ruling, despite the fact that these are senior citizens.

According to the Argentine Budget Association (ASAP), "in the average income per beneficiary, as of March 2025, compared to November 2023 (the month before the change of government), the loss of purchasing power is close to 10% .

In July, the minimum wage plus the bonus fell 2.7% year-over-year, adjusted for inflation. Compared to July 2023, the actual decline rose to 13.1% . (ASAP). In addition, the VAT refund on purchases made with the pension debit card was repealed, and discounts on medications were reduced (PAMI).

This loss adds to previous ones. To take just the last few years, in 2017, during Mauricio Macri's administration, the change in the mobility formula represented an initial drop in salaries because it was implemented retroactively.

In March 2018, retirees received 5.71% - based on the 70% inflation rate and 30% of salaries for the third quarter of 2017 - when they should have received the mobility provided by the previous law - No. 26,417 - which was estimated at around 14.6% for the second half of 2017. There have been court rulings challenging this "reduction," but the Supreme Court has not yet ruled.

Then, between September 2017 and December 2019, due to rising inflation, retirement and pension benefits declined by 19.5%.

As soon as Alberto Fernández took office, the previous mobility formula was suspended, and in 2020, differentiated increases were granted by decree. In March, minimum wages received a larger increase than the rest, which led to a 35.3% increase in minimum wages that year, but a mere 25.3% increase in other wages, compared to an inflation rate of 36.1% . With the suspended law, the increase would have been higher ( 42% ), and there were court rulings that recognized this difference.

Then a new mobility formula was implemented—50% salaries and 50% tax revenue going to Social Security—which clearly lost out as inflation soared. The results were:

• In 2021, with inflation at 50.9%, the end-to-end increases were 52.7%.

• In 2022, the mobility formula yielded 72.5% versus an annual inflation rate of 94.8%. A loss of 11.5%.

• In 2023, mobility was 110.9% and inflation was 211.4%, exacerbated by the surge in December of that year caused by Javier Milei's devaluation. A loss of 32.3%.

In 2024, the new inflation-related mobility formula skipped part of January's inflation ( 12.5% ​​was recognized in April versus a 20.6% price increase), and while increases were applied based on price increases, Alberto Fernández's previous formula remained in effect only until June of that year.

Retirement benefits were adjusted for inflation, but the "reinforcement" bonus of up to $70,000 for minimum wages was frozen at the March 2024 value.

Meanwhile, "while salaries increased by 138.2% between March 2024 and September 2025, the minimum, including the bonus, only increased by 90.9% . If it had been updated in the same proportion, the bonus should have been $166,755 in September 2025, that is, more than double ( +$96,755 ) of the current amount," states a report by CEPA (Argentine Center for Political Economy).

If the previous government's formula had continued, the increase in salaries would have been higher (+33%) in September 2024 due to the increase in both salaries and tax revenues going to Social Security.

Applying inflation-based mobility initially improved pensions compared to what would have happened with Alberto Fernández's mobility law. But if inflation falls and wages and tax revenues begin to improve, retirees' pensions would evolve above what would have emerged with the inflation formula alone. This is what has been happening now.

According to the consulting firm IDESA (Argentine Social Development Institute), "the liquidation of pensions was so severe that by 2023, pensions had lost an average of 35% of their real value compared to the 2017 average. In the case of the minimum pension—which receives a bonus—the loss was 15% . This is a huge fiscal "saving" because pension payments are the main expense of the national government. The way to freeze these "savings" forever is to adjust pensions—from now on—by inflation ," which is what the current government has implemented.

For its part, the CEPA report states that “in September 2025, with the 1.9% increase (CPI of July 2025) of the Milei formula, the minimum retirement (without bonus) will be $320,277 , while if the previous formula had continued it would be $413,520 ( 29.1% higher).” And it adds: “In this way, we can conclude that the previous formula, over time, would have been superior for retirement benefits, and it was intentionally eliminated before the improvements occurred.”

Adjusting for inflation alone perpetuates the pension losses of recent years because it keeps the purchasing power of pensions constant . And they don't see any improvement if real wages and/or tax revenues recover due to improvements in productivity and the economy.

For this reason, the best option for retirees was to combine both alternatives: to prevent their income from deteriorating further in the future, a full monthly inflation adjustment is recommended, as well as maintaining a comparison between the inflation formula and the salary and revenue formula , applying the higher one.

Funding would come from increased revenue due to the improved economy and contributions to ANSeS (National Social Security Administration) due to increased wages and employment levels, as well as an effective fight against informality.

Given this more than critical situation, the law approved by Congress (vetoed by President Milei) granted a minimum partial increase of 7.2% to the pension benefits received by just over seven million retirees and pensioners and an increase in the bonus frozen since March 2024 for minimum salaries of $40,000, from $70,000 to $110,000, which will be updated monthly using the inflation mobility formula.

The 7.2% increase corresponded to the adjustment that should have been applied in April 2024 because, as noted, the Government granted a 12.5% ​​increase for January of that year when inflation that month was 20.6%.

However, the increase is not retroactive because the law stated that "the indicated increase will be incorporated into the monthly salary following the enactment of this law based on the amount received in the month of its enactment." Nor is the bonus increase retroactive to April 2024. And the bonus starting at $110,000 would be adjusted for inflation; it would not be incorporated into the current salary and therefore would continue without the payment of the Christmas bonus.

A significant point, and a nod to the government and the judiciary, the law ratified Milei's inflation-based mobility formula, as approved by presidential decree last year. It did not contemplate recognition of what had been lost in recent years, despite numerous court rulings, nor a forward adjustment for economic growth or salary increases. Instead, the court rulings mandated that this loss be repaid.

The adjustment for inflation alone "reinforces the loss of purchasing power. It doesn't recover what was lost in recent years, and the connection was flawed, with the promise of litigation, since it doesn't follow the logic of Decree 274/2024 itself to compensate for inflation in January 2024," according to pension lawyer Aníbal Paz.

Meanwhile, the government has a pension reform on the agenda, which it pledged to push through in 2026. This reform includes, among other things, raising the retirement age, repealing differential pension systems (for national teachers, university teachers, the Electricity and Power sector, and the judiciary, among others), restricting widow's pensions , and requiring new retirees to receive an initial pension based on the number of years they have actually contributed , with a minimum guaranteed amount.

“Every retirement and pension system, whether pay-as-you-go or collectively or individually funded, is closely linked to worker contributions and employer contributions. No public or private system can guarantee generous long-term benefits or self-financing if contributions are low, resulting from informality and job instability, or from policies that restrict the amount of such resources, given that informality and the level of employment are problems of the labor market, not the pension system,” notes ASAP.

Official data show that out of 21 million jobs, 12.5 million contribute to Social Security. 8.5 million do not contribute . And of the 12.5 million who do contribute, a high proportion have periods of inactivity, suggesting that by the time they reach retirement age (60 for women, 65 for men) , they will not have the minimum 30 years of contributions to qualify for retirement.

Regarding the repeal of the moratorium, "the analysis shows that 50% of men and 69% of women of retirement age will not be able to access a contributory benefit. Although there are some mechanisms that allow to moderate the described situation, such as compensation for excess age with lack of services (art. 19 Law 24.241), the possibility of obtaining the Advanced Age Benefit (art. 34 bis Law 24.241) and the recognition of years of service for children for women who have become mothers established by Decree 475/2021, it is evident that there are great difficulties in providing coverage in old age through the contributory regime," states a Social Security report.

For their part, the Federal and Social Security Chambers of Tucumán, Córdoba, Mendoza, Salta, Mar del Plata, Rosario, and Bahía Blanca declared the mobility formula applied between 2021 and March 2024, during Alberto Fernández's administration, unconstitutional . They also ordered compensation for the losses accumulated during that entire period.

To date, and despite the involvement of senior citizens, the Supreme Court has not ruled on these pension losses, nor on previous ones, such as those caused by the retroactive application of the mobility formula during Mauricio Macri's administration and the deterioration in mobility between September 2017 and the end of 2019, which was 18.5%.