Spain's new pension law aids 100,000 mutualists but excludes 47,000 retirees

Spain's government has approved a new social security law that will improve pensions for more than 100,000 mutualists, but leaves out around 47,000 retirees who belonged to the same alternative retirement systems. The law, announced this week, aims to correct long-standing inequalities for professionals who paid into mutual societies instead of the general Social Security scheme. Mutualists include lawyers, architects, and other self-employed professionals who were required to join sector-specific mutual funds before the 1990s. Because these funds often provided lower benefits, many mutualists ended up with smaller pensions than their Social Security counterparts. The new law increases pensions for those who retired after 2005 and meet certain contribution thresholds. However, it excludes retirees who stopped working before 2005 or who paid into certain mutual societies that are now closed. The government says the exclusion is due to budgetary constraints and the difficulty of recalculating older contributions. Critics argue the law creates an arbitrary cutoff that penalizes some of the most vulnerable pensioners. The law will take effect in 2026, with payments retroactive to January 2025. Experts estimate the cost at €1.2 billion over five years. The measure is part of a broader pension reform package that Spain is implementing under its recovery plan. The excluded retirees are considering legal challenges, claiming the law violates the principle of equal treatment. The government has said it will review the situation after the first year of implementation.