WILLEMSTAD – Civil servants’ union ABVO has formally objected to the government’s plan to make the indexation of the AOV pension dependent on economic growth, warning that the proposal could further erode the purchasing power of retirees.
The objection centers on a provision in the National Covenant on AOV, which states that as of January 1, 2027, pensions will be adjusted based on inflation—but only if real economic growth reaches at least two percent in the preceding year.
According to ABVO, this condition represents a significant obstacle to maintaining the value of pensions. The union argues that AOV beneficiaries have already experienced a decline in purchasing power in recent years due to the absence of consistent indexation. Tying future adjustments to economic growth, it says, risks prolonging and deepening that loss.
The union is therefore calling for AOV pensions to be indexed solely on the basis of the consumer price index (CPI), without additional conditions. Such an approach, ABVO argues, would better reflect the rising cost of living faced by pensioners.
ABVO emphasized that the agreements outlined in the covenant extend beyond the organizations directly involved and will affect all current and future AOV recipients. On that basis, the union maintains it has the right to formally challenge the government’s policy direction.
In addition, the organization is urging that further discussions on AOV indexation take place within a broader societal framework, involving all relevant stakeholders.
The union has also indicated it is prepared to take legal action if necessary. Its formal objection has been submitted to the government, with copies sent to the Curaçao Parliament, the Social and Economic Council, and the Council of Advice.
The issue is expected to spark wider debate over pension policy and the balance between fiscal sustainability and social protection in Curaçao.