Social benefits and civil servants’ wages will rise by 2 percent in early 2022, as the pivotal index will be exceeded in December. That is what the Planning Bureau predicts. The pivot index was last exceeded in August.
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When that happens, social benefits are indexed by 2 percent the following month, with government staff wages following a month later. Due to the persistently high inflation, the Planning Bureau expects the pivotal index to be exceeded again this month. A month ago, it was predicted that that would not happen until January 2022.
Until recently, the Planning Bureau thought that there would be no further exceedances in 2022, but now assumes that the pivotal index will be exceeded again in August. If that forecast comes true, it means that social benefits and government employee wages would be indexed for the third time in 13 months, respectively, in September and October.
Inflation, which was 5.64 percent in November at its highest level since July 2008, is expected to remain above 5 percent until March next year, the Planning Bureau expects. Average annual inflation is expected to be 2.4 percent this year and 3.8 percent in 2022.
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