Retirees receiving the minimum pension: “I end the month with one cent in the bank”

PalmCarmen showered with cold water all winter. She didn't have the money to buy a new water heater. At 54, she lost her job as a tourist information assistant when the Menorca Island Council privatized the service. She collected unemployment benefits and never found another job. Then she survived on a subsidy of 400 euros, which wasn't even enough to cover her rent. She gave tutoring lessons for five euros, structured as a part-time job. "I earned an extra 300 euros. I spent eight years fighting eviction," she confesses.

The Balearic Housing Institute (Ibavi) couldn't grant her social housing because she didn't meet the minimum income requirements. Now she has a home. At 68 years old, she receives 970 euros, the established minimum pension, and is demanding that it be brought in line with the Minimum Interprofessional Wage (SMI), set at 1,221 euros per year in 2026, paid in 14 installments, 37 euros more than last year. The Balearic Coordinator for the Defense of Public Pensions—comprised of unions, pensioners' platforms from all the islands, and other social organizations—presented a Popular Legislative Initiative (ILP) in the Balearic Parliament in September 2025 to create a regional pension supplement system that would achieve the aforementioned equalization. The movement calls for resolving this unjust situation and strengthening social protection and personal autonomy, as established by the Constitution and the Statute of Autonomy of the Balearic Islands. They propose that those over 60 be eligible to receive this supplement, taking into account their economic needs and other requirements stipulated by law.

Among the objectives is reducing the gender gap in subsidies, since the main beneficiaries would be women, many of whom receive non-contributory pensions. This is the case of María, a 79-year-old widow, who worked without a contract in domestic service while caring for her children. "My husband was self-employed. We didn't have anyone here, and I cleaned houses and businesses from the time I dropped my children off at school until I picked them up. I had no other option," she explains, justifying why she hasn't paid into the system. Her husband died five years ago. She has paid off her house "with a lot of effort" and receives 930 euros. "I've had a very hard time. I pay all the expenses, I do the shopping, and I've managed, at my age, to live comfortably. My friends eat at a restaurant every Sunday. I don't. I can't. I prefer to stay home and save some money in case of an emergency," she explains.

Gender gap

The average pension in the Balearic Islands has more than doubled in the last 20 years: a 122% increase, rising from €551 in 2005 to €1,224 in 2025. Two decades ago, the gender gap was already evident: men received €688.92, compared to €43 for women. By 2025, the situation remained unchanged: €1,456.19 in pensions for men, compared to €1,032.61 for women. However, the average pension in the archipelago is lower than the Spanish average, currently €1,363. Therefore, an islander receives, on average, €139 less despite facing a higher cost of living. "We must add the problem of insularity and the absolute dependence on the tourism industry, which generates a labor market of seasonal workers. We demand the bare minimum to live with dignity, because behind the tourist postcard image lies an unbearable abyss of poverty. There are people earning 500 euros or even less than the pension they don't contribute to. Precariousness doesn't generate rebellion, but submission."

Besides women, who haven't contributed to social security to care for their families, the self-employed are another group heavily affected by low pensions. Toni retired in April at 65. With over 40 years of contributions as a truck driver, he receives a pension of 860 euros. In reality, he was a bogus self-employed worker: the company he worked for gave him the schedule, the clients, the load, but he wasn't actually employed by them. "The self-employed have the disadvantages of both salaried employees and business owners. It seems like you earn a lot, but when you deduct expenses, it's practically nothing. If the truck broke down, I had to repair it, and in the meantime, I didn't get paid. I worked like a dog. Saturdays and Sundays." Toni paid around 300 euros in self-employment contributions. "It was what we all used to do," he says. A higher contribution would have given him a higher pension: "I had to choose between paying more or paying my mortgage and feeding my family. I don't regret it, because if I were now earning a €1,500 pension and didn't own a home, I'd have nowhere to live. I chose peace of mind, and instead of going on cruises." But he advocates for equalization with the minimum wage as a fair system, opposing those whose "objective is to incentivize private pension plans while failing to guarantee the existence of the public system in 20 years." According to the Popular Legislative Initiative (ILP) that calls for equalization, 126,138 pensioners in the Balearic Islands have incomes below €1,184. Furthermore, the gap between pensions and the minimum wage has widened. In 2011, it represented 93.7% of the minimum wage, while in 2023 it had fallen to 72.5%. The difference reflects "a situation of injustice, poverty, and inequality that requires immediate action." The platform estimates that 94,017 people would benefit from the supplement (after deducting duplicates and specific situations), and the cost would be approximately between 4% and 5% of the Autonomous Community's annual budget.

Minimum income supplements

In the Balearic Islands, 32,749 pensioners receive the so-called minimum income supplement to reach the legally established minimum amount. Among them is Carmen. Of the 970 euros she receives, 324 go towards her Ibavi rent. She manages the rest very carefully. "I don't mention food or fish. I bought the cheapest one and had the most ready ones with the one I need most urgently. All are very basic foods. It's sad to arrive at this age and I live knowing that if the freezer breaks, I'll have a problem. The next one will come and I haven't had it again. I don't want to have a drink in a restaurant or even allow myself a coffee in a bar. For Carmen it is "atrocious" that they do not match her pension in the SMI. "I have always been permanently fixed because that is how seasonality works in Menorca. "So, someone like me should have contributed for 70 years," he concludes.

Economist Guillem López Casasnovas questions the alignment of minimum pensions with the minimum wage and defends the principle of proportionality between contributions and benefits received. In his opinion, "many preferred to pay lower contributions and save more to accumulate wealth," so "it makes no sense that those who have contributed very little receive the same as those who have contributed the most."

The expert understands that the collective effort is already being made. "If the minimum pension were €3,000 and the minimum wage were also €3,000, it would still seem unfair to me that someone who contributes earns the same as someone who receives a pension." Regarding the sustainability of the system, the economist warns that the current balance depends on state transfers to Social Security. "The only way to sustain pensions is with that money." If pensions had to be paid for with current salaries, contributions would have to rise so much that workers would receive even less. And even less than pensioners. It doesn't make sense," he asserts before reinforcing his point: "If Social Security alone financed pensions, Spain would be in dire straits. Future generations would suffer." His idea is clear: "Your pension is determined by your contributions."