WILLEMSTAD – Pension benefits in Curaçao have not been adjusted for inflation since 2013 because the legal mechanism used to calculate annual increases cannot be implemented in practice.
This issue is highlighted in a recent advisory opinion from the Advisory Council of Curaçao reviewing proposed amendments to the country’s pension legislation.
The council explained that a reform introduced in 2013 linked pension indexation to economic growth measured between August of one year and August of the following year. However, the Central Bureau of Statistics measures economic growth based on calendar years, not the August-to-August period required by law.
As a result, the necessary data to calculate pension adjustments under the legal formula has never been available.
The unintended consequence is that pensions under both the old-age insurance system and the survivors’ pension system have effectively remained frozen since the reform took effect.
According to the advisory council, the prolonged absence of indexation has led to growing dissatisfaction among pensioners and sparked public debate and legal action against the government and the Social Insurance Bank.
The council emphasized that a structural and legally workable solution must be found to ensure pension benefits can be adjusted in the future.