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This year there will also be a pension premium, which will be higher than last year

The Prime Minister also told members of the Council that this year the number of women who will be eligible for early retirement after forty years in employment will reach 230,000. “Among ourselves we call this the grandmas’ pension, because we also intend this to be a family policy measure”, he said, as young parents will thereby receive great assistance when the older generation’s grandchildren are being cared for.

Mr. Orbán also stressed that the concept of family must be rehabilitated, and that in Hungary the multi-generational model of care within the family must be restored.

Photo: Gergely Botár

He stressed that the continent is sharply divided by the various responses given to the population decline that is afflicting almost every European country. According to one half of Europe, he observed, if there are not enough young people, “let us take some […] from Africa and Asia, let us resettle migrants and outsiders to replace the declining indigenous, native population”. According to the other camp – which he described as “the romantic camp, that we are part of” – he said that “if we want to transform this situation, we may even succeed”. The goal of the Government, he said, is to enable Hungary to achieve a state of biological reproduction, and therefore it is pursuing robust family policy.

He pointed out that the social response should not only be about young people deciding to have children. A change of paradigm is also needed: families should be thought of as units which comprise grandparents as well as young people and their children. “The elderly should not be a burden on a community or family, but much rather a resource”, he observed, stressing that this is the essence of enhancing the concept of family.

In his address the Prime Minister said that the most important task for the 2018–2030 period will be increasing economic competitiveness, pointing out that this is the precondition for continuing policies such as the current family support system and increases in the value of pensions.

Regarding the latter, he stressed that in every year before 2010 the value of pensions had decreased, but that since then this has changed – to the extent that last year pensioners received a pension premium, which will be repeated this year. And as this year the country’s economic growth rate will be above 4 per cent, and nearer to 4.5 per cent, he said that this year the pension premium “will be higher, according to all calculations, than last time”.

Mr. Orbán said that “Our earlier agreement is still in effect: we are pursuing a policy which seeks to preserve the value of pensions – indeed as far as possible we are striving to increase pensions; meanwhile you are supporting economic policy which is capable of raising the financial resources for this pension increase.”

The Prime Minister also spoke about the employment of pensioners, noting that in Hungary today there are more job vacancies than people under pensionable age who are able to fill them. Therefore, he said, pensioners who wish to work must be enabled to remain in or to return to the world of work, while also retaining their pensions.

He outlined the latest measures related to this, including the establishment of pensioner cooperatives – of which there are 146 today, employing a total of 10,600 people. In addition to these, he said, on 1 November new rules will enter into force which will enable pensioners in employment to receive both their pensions and salaries, while only having to pay 15 per cent income tax on the latter. In his opinion, this means that the employment of elderly people will be a good deal for both employers and for pensioners who feel strong enough to work.

Photo: Gergely Botár

In summary, he said that from 1 November a new world awaits older persons in Hungary who rightly want to receive and retain their pensions, and who at the same time want the Hungarian state to support them rather than punish them if they want to work after retirement age.

According to the Prime Minister, if only a fraction of the 2 to 2.5 million pensioners want to return to work, the Hungarian labour market and the Hungarian economy will “receive an enormous injection of energy”, which will also be felt in economic growth over the coming years.