Poverty deepens: the number of working retirees quadruples in two years

By the end of 2024, the number of actively insured workers paying premiums to the Social Security Institution (SGK) reached 25,675,705, while the number of people receiving pensions, whether due to old age, disability, survivor benefits, or other allowances rose to 16,602,000. According to SGK’s year-end data for December 2024, 12,028,000 of these beneficiaries were standard retirees receiving old-age pensions, while the rest included widows, orphans, disability pensioners, and others receiving compensation for occupational injuries or fatalities. As a result, SGK’s active/passive ratio dropped from 1.66 at the end of 2023 to 1.61 by the end of 2024. With SGK unable to sustain itself without transfers from the Treasury, its financial situation has worsened further, posing an increasing burden on public finances.

SGK FAILING BY ILO STANDARDS

According to International Labour Organization (ILO) standards, a healthy social security system should maintain an active/passive ratio of 4.0, meaning four active workers should fund one retiree to ensure the system's sustainability while providing decent pensions. However, Turkey’s ratio has now fallen to 1.61, meaning one active worker is supporting 1.61 retirees a clear sign of an unsustainable system. This decline puts severe strain on pension payments and healthcare expenditures, increasing the burden on the Treasury and pushing the social security system toward a critical state. Just two years ago, at the end of 2022, the ratio was at 2.01, but the sharp deterioration is largely attributed to the Early Retirement Scheme (EYT) introduced before the 2023 presidential and parliamentary elections. Following this reform, the number of new pensioners receiving monthly payments from SGK increased by 2,741,000 over two years, further destabilizing the system.

‘SUPER RETIREES’ FACE SUPER HARDSHIP

Decades of political maneuvering have turned Turkey’s social security and pension system into a chaotic mess, with massive disparities in pensions and social rights. One of the most controversial schemes was the ‘Super Retirement’ system, introduced during the ANAP government with the promise of European-style high pensions. Under this system, SGK collected large lump-sum premium payments from millions of people. However, after the Constitutional Court annulled the scheme for violating the principle of equality, these so-called ‘super retirees’ were left in financial limbo. For years, they were excluded from pension raises until the rest of the pensioners’ salaries caught up to their levels.

RETIREMENT “TREAT” FOR MPS

Another long-standing controversial regulation is what the public refers to as ‘Retirement Treat’ for Members of Parliament. First introduced during ANAP's rule and later sustained through bipartisan cooperation, this law grants MPs the right to retire after just two years in office. Despite being annulled multiple times by the Constitutional Court, successive governments reinstated the privilege. Today, MPs who retire after two years of service receive pensions far exceeding those of ordinary SGK retirees. If re-elected, they continue receiving both their pension and their MP salary, deepening social inequality in the pension system.

POST-2000 PENSIONERS: VICTIMS OF KEMAL DERVIŞ'S REFORMS

During the early 2000s economic crisis, Kemal Derviş, brought in as Minister of Economy from the IMF, led sweeping pension reforms under the Strengthened Transition to the Economy Program. These reforms increased the required number of premium contribution days and gradually raised the retirement age for both men and women. Many workers who had completed their required premium days found themselves waiting for years to reach the new minimum age requirement before receiving a pension. While this temporarily improved SGK’s actuarial balance, raising the active/passive ratio to 3-3.5, it also set the stage for the later Early Retirement (EYT) crisis. The resulting income disparity between pre- and post-2000 retirees has become an ongoing issue, commonly referred to as the ‘pension adjustment problem’ (intibak sorunu), which remains unresolved.

POST-2008 PENSIONERS: VICTIMS OF AKP'S CUTS

During the 2008 financial crisis, the government under the AKP implemented another radical pension reform. The state-run social security institutions—SSK, Bağ-Kur, and the Pension Fund (Emekli Sandığı)—were merged under SGK. The most significant impact was the drastic reduction in pension replacement rates, which fell from 75-80% down to 50%. Before this reform, many retirees could afford to buy apartments or cars with their severance pay, and worker housing projects were built in major cities (e.g., Türk-İş Blocks in Ankara and the 100th Year Worker Blocks in Balgat). However, after 2008, pensioners faced a rapid decline in living standards, accelerating poverty and social insecurity.

RETIREMENT INEQUALITY

Currently, the bottleneck in the social security system continues to deepen. Although they are under the roof of SSI, labour, civil servants and Bağ-Kur pensioners are subject to different salary, premium payment and monthly binding regimes under the names of 4/a, 4/b, 4/c. While those in the labour status are entitled to retirement by paying 7500 working days of premium, the number of premium days for tradesmen and agricultural Bağ-Kur members is 9 thousand. While the lowest pension of civil servant pensioners with 4/c status became 19 thousand 450 TL with the increase made at the beginning of this year, the lowest pension determined by law every year for labour pensioners with 4/a status became 14 thousand 460 TL this year. There is a difference of approximately 5 thousand TL between the lowest civil servant and labour pensions. Among the SSI members who retired by paying premiums from the ceiling in the last period close to retirement, there are those who receive a pension of up to 35-45 thousand TL. Since the system operates on a file basis, the death pension binding rates for widows and orphans receiving death pensions from the SSI vary between 35-50 per cent. The lowest monthly amount of 14 thousand 460 TL is shared among the widows and orphans. Millions of widows and orphans have a pension of less than 10 thousand TL.

PRIVATIZATION OF SOCIAL SECURITY

Now, the AKP government is preparing for another wave of pension reform, planning to introduce the Supplementary Pension System (TES) in the second half of 2024. Under TES, workers will be required to make a second pension contribution on top of their SGK premiums, with additional contributions from employers and the state. This model closely resembles privatized pension schemes imposed under IMF pressure in Chile, Argentina, and Brazil, which have led to severe pension crises in those countries. The AKP governments, which step by step privatised the social security system, which stipulates that health expenses are covered by the Social Security Institution (SGK), with ‘co-payment’ and ‘Complementary Health Insurance-TSS’ practices, now envisages to privatise the social security system with the TES project as an alternative to the SGK, whose data by the end of 2024 points to bankruptcy.

Source: Sefalet derinleşiyor: Çalışan emekli 2 yılda dörde katlandı