Italy to soften plans to hike retirement age in 2024, draft budget shows

ROME (Reuters) – Italy’s government has softened plans to hike the retirement age from next year, under a draft budget seen by Reuters on Friday.

Prime Minister Giorgia Meloni’s government this month said it planned to tighten in 2024 a temporary regime that this year allowed people to retire if they are at least 62 years old and have worked for 41 years, with the sum totalling 103.

Rome wanted to hike by one year to 63 the age requirement while also introducing disincentives for those who retire and fiscal benefits for those who agree to stay in work.

But after tense talks within the ruling coalition, Meloni opted to maintain the 103 scheme with some adjustments to encourage people to keep working, according to the latest draft budget available ahead of its official publication.

The document showed that people who decide to retire early will face a pension cut. Workers will be able to retire after seven months (nine if they are public employees) have passed since meeting the requirements.

The stop-gap solution avoids a steep hike in the retirement age to 67 that otherwise would have automatically kicked in from January, under a system introduced in 2012 at the height of a debt crisis but suspended seven years later.

In its multi-year budget framework unveiled last month, the Treasury sees Italy’s state pension bill, already among the highest in the world, reaching 17% of gross domestic product in 2042, up from 15.3% in 2022.

(Reporting by Giuseppe Fonte; Editing by David Holmes)