As Luxembourg prepares for a parliamentary debate on pension reform, new projections indicate that automatic adjustments to the system could occur in 2026, two years earlier than previously anticipated.

As the Luxembourg government continues to keep its stance on pension reform under wraps, updated projections have now been released – just two weeks before the first consultation debate in the Chamber of Deputies.

According to the latest scenario outlined by the General Inspectorate of Social Security (IGSS), there is a possibility that an automatic readjustment mechanism could be triggered as early as 2026. This would reduce the impact of indexation on pensions, a development previously projected for 2028 when a deficit was expected to occur.

By 2039, the legal threshold for pension reserves is anticipated to be breached – two years earlier than initially forecast. If no corrective measures are taken, the pension fund's reserves are expected to be fully depleted by 2045, i.e., exactly 20 years from now.

Revised timelines are based on the thresholds established by the 2013 pension system reform. The updated projections were presented to members of the parliamentary committee on social affairs during a meeting on Wednesday.

In 2022, there were approximately 200,000 pensioners compared to around 500,000 active residents. By 2050, the number of pensioners is expected to double, and by 2070, it could even triple.

Minister of Social Security Martine Deprez has emphasised her intention to gather input from all parliamentary groups ahead of the upcoming debate in the Chamber of Deputies. This includes discussions on key issues such as pension amounts, the comparison between Luxembourg's two pension schemes, and the legal retirement age.