Overview
- Spain currently calculates pensions over the last 25 years of contributions, a window set to rise to 28.6 years by 2036, but the OECD recommends moving toward roughly 35 years.
- The OECD says a 35‑year base would trim the annual deficit by about 0.1 percentage point of GDP and projects public debt could reach around 135% of GDP by 2050 without further action.
- The report calls for restoring incentives linked to longevity, avoiding further payroll tax hikes, and creating more flexible retirement paths to encourage longer working lives.
- It urges reform of non‑contributory unemployment assistance for over‑55s, which it says discourages re‑employment and can act as a de facto early‑retirement route.
- Broader recommendations include expanding legal migration and early integration support, rebalancing the tax mix, increasing social housing, and strengthening anti‑corruption and public procurement controls.