WILLEMSTAD – The Curaçao government is exploring an increase in old-age pension payments, but financial supervisors are warning that any increase must be carefully financed to avoid destabilizing public finances.
According to the latest half-year report from the Committee Financial Supervision (Cft), the government asked for advice in December 2025 on three possible scenarios to raise the Basic Old Age Pension (AOV) payments.
The issue has gained urgency because pension benefits have not been indexed since 2021, despite several years of economic growth and inflation.
That means many pensioners have effectively lost purchasing power.
The Cft acknowledged the social pressure to increase pensions but stressed that any increase must have structural financing behind it.
The watchdog warned that temporary funding solutions could create long-term budget problems.
This is especially sensitive because Curaçao’s budget outlook for 2026 is already tight, with only a projected XCG 5 million surplus.
Adding pension costs without new revenue or savings elsewhere could push the budget into deficit.
The broader issue is demographic change.
Curaçao’s aging population means pension costs will continue rising in the coming years.
With more than one-quarter of the population now over 65, pension obligations will become increasingly significant.
The Cft says any pension reform must be part of a wider financial strategy that balances social needs with fiscal sustainability.
The discussion now places the government in a difficult position: helping retirees cope with higher living costs while protecting the island’s financial stability.