Andorra Pension Chiefs Warn of Lost Year, Urge Swift Reform as Costs Soar

**Jordi Cinca and Marc Galabert have urged politicians to act swiftly on pension reform, warning that another year has passed without progress amid projections of rising costs and a shrinking contributor-to-pensioner ratio.**

The presidents of the Fons de Reserva de Jubilació (FRJ) and the CASS council of administration, Jordi Cinca and Marc Galabert, appeared before the Consell General's legislative commission on pensions on Tuesday. They expressed frustration over the lack of advances in reforming the pension system, stressing that demographic trends threaten its long-term viability.

Cinca described the situation bluntly: "It's evident that another year has been lost." He highlighted that the current dependency ratio stands at roughly three contributors per pensioner, but projections indicate it will drop to about 2.6 contributors per pensioner as pension numbers double by 2040. At that point, annual pension spending could reach 570 million euros, requiring over 80,000 contributors—more than double the current 40,000—to maintain balance without changes.

"The causes justifying reform are clear and have been identified for years," Cinca said, calling on lawmakers to consider data on birth rates, immigration, employment, and pensions together. He argued that delays only worsen the challenge, forcing harsher measures later and shortening transition periods. While the FRJ's role is to provide technical warnings and projections, Cinca emphasized that decisions rest with politicians. "Any model is legitimate; what is not legitimate is doing nothing," he stated, noting options from parametric adjustments like higher contributions to structural shifts incorporating capitalization.

Galabert echoed the urgency, deeming reform "unpostponable." He noted that pension expenses grew from 156 million euros in 2024 to higher levels, while the retirement branch still shows surpluses—such as 27 million euros recently—but these are narrowing. The system could hold if growth stays around 2-2.5% annually, though crises like market turmoil from the Iran conflict could accelerate deficits. Committed points total 151-152 million euros for nearly 196,000 contributors, potentially worth 410 million euros at current values.

Despite concerns, the FRJ reported strong 2025 results: a 6.39% return exceeding its 5.70% benchmark, generating 105.4 million euros in investment gains and a net accounting result of 131.8 million euros. This outperformed comparable Spanish (4.85%), Italian (5%), and eurozone funds, as well as Swiss averages. For 2026, provisional data through May show 2.7-2.8% returns and assets at 2,047.5 million euros, despite a March dip.

Cinca defended actuarial studies against skepticism from Social Democrat councillor Susanna Vela, insisting their trends remain reliable despite past variances due to stronger growth. Both leaders called for parliamentary groups to propose models for impact analysis, allowing gradual implementation.