Pension spending benefits 18 million Mexicans

Next year, the Mexican government will invest 2.12 billion pesos, equivalent to almost a quarter of the federal budget, in around 18 million people. According to a calculation by the Center for Budgetary Economic Research (CIEP), 23.5 percent of the federal government’s net spending in 2025 will be destined for the payment of contributory and non-contributory pensions, which will represent 6 percent of the gross domestic product (GDP). ) and a real increase of 4.3 percent compared to 2024.

In the proposal of the Ministry of Finance and Public Credit for the 2025 economic package, the expenditure to comply with the payment of pensions, which is a constitutional right of Mexicans, is close to the amount that the government assigns to the federal entities and municipalities, which in 2025 will be 2.4 billion pesos, which is made up of shares of federal income and federal contributions derived from the Fiscal Coordination Law.

Contributory pensions are covered with resources from the public budget and are for workers who retired with the defined benefit system and who contributed to the Mexican Social Security Institute (IMSS) or the Institute of Security and Social Services of State Workers (Issste ), before the Retirement Savings System was created, which gave rise to the fund administrators or Afore.

For the coming year, one billion 637 thousand 700 million pesos will be allocated to this group of pensioners, which represents an increase of 4.8 percent in real terms compared to 2024, while the Pension for the Welfare of the Elderly, also paid with government resources, and which is granted from the age of 65, will mean an expense of 483 thousand 427.6 million pesos, and it is 0.33 percent lower than in 2024.

Data from different agencies indicate that the IMSS has just over 4.5 million retirees, while the Issste has 1.2 million.

Meanwhile, Petróleos Mexicanos has approximately 110 thousand registered, and the Federal Electricity Commission almost 50 thousand. The Social Security Institute for the Mexican Armed Forces has 30 thousand pensioners, and other state organizations together have a list of 50 thousand retired people.

Meanwhile, the Welfare Secretariat reported that there are 12 million 231 thousand 625 beneficiaries who receive the Welfare Pension, which represents an annual disbursement of 465 thousand 48 million pesos, of which, between January and June 2024, they were paid 217 thousand 924 million pesos.

In May 2020, the fourth article of the Political Constitution of the United Mexican States was reformed to establish the right of older adults to receive a non-contributory pension from the State.

On the subject, Carlos Ramírez, partner and political risk consultant at Integralia, commented to The Day that the Mexican population is going to age very quickly in the coming decades and what is coming is an avalanche of pressures for public spending.