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The transition generation is 'punished', 55% of pensioners with partial payments in 2025

Politiko 2026-06-11 12:59:31

The transition generation is 'punished', 55% of pensioners with

From year to year, the financial situation of pensioners is worsening, as the share of those who fail to meet the conditions for a full pension is rapidly expanding.

According to data from the Social Insurance Institute, in 2025 partial pensions accounted for 55.2% of total old-age pensions, expanding by 3 percentage points in one year, from 52.1% in 2024.

During 2025, the number of full pension beneficiaries has decreased, dropping from 287,279 beneficiaries in 2024 to 283,677 in 2025 or -1.3%. While the partial pension category has experienced further strong growth, increasing from 316,781 to 353,983 beneficiaries within the same time frame or 11.7%.

The benefit of a pension is calculated in relation to the years that a person has paid contributions against the period required by law, which is gradually increasing beyond 38 years. Most of these pensioners receive only a fraction of the basic pension, often very close to the level of the social pension. These amounts are insufficient to cover the minimum costs of living, especially in an environment where food and medical costs are rising and other payments to employees have increased faster.

To survive, many elderly people who receive partial pensions are forced to continue working beyond retirement age, often informally.

The rapid expansion of the number of partially paid pensioners in Albania, which within a year jumped from 52.1% to 55.2% of the total, is a direct consequence of the structural problems that the labor market and domestic legislation have had over the last three decades.

The 2014 Pension Reform brought a progressive increase in the criteria for receiving a full pension. The legal threshold is increasing every year to receive a full pension, the required years of contributions are gradually shifting to stabilize at 40 years in 2032.

Many citizens who reach the retirement age of 65 for men and currently over 61 and a half for women discover that, even though they have worked a good part of their lives, they cannot reach this new and high legal ceiling, automatically qualifying for a partial pension.

The pensioners who are entering the scheme today are the generation that worked during the transition years, after 1991. After the fall of the communist regime and the closure of state-owned enterprises, a massive part of the workforce moved into the newly created private sector, where working without certificates and without insurance in the black market was a widespread phenomenon. Many years of work in private businesses, construction or trade from the period 1992–2010 have never been declared, creating large holes in the contribution history of citizens.

Albania has also had successive waves of emigration. Many citizens have worked for 10 or 15 years in Albania and then emigrated mainly to Greece or Italy, where they have often also worked irregularly or paid contributions into the systems of those countries.

In the long term, if this trend is not curbed through aggressive policies against informality and encouraging the declaration of real wages, the scheme risks turning from an insurance system into a social assistance system, where the state pays minimal amounts to avoid extreme poverty in a rapidly aging population. /Monitor