Czech pensions to rise in January, with CZK 2,000 bonus also planned

People receiving Czech pensions will get an increase from January, with the average old-age pension set to rise by CZK 304 a month to CZK 22,196. The government also wants to pay pensioners a one-time CZK 2,000 bonus, though that payment has not yet become law.

The cabinet approved the annual pension adjustment Monday as it considered next year’s state budget. Labor and Social Affairs Minister Aleš Juchelka said the monthly increase amounts to about 1.4 percent for someone receiving the average old-age pension.

The two measures have different statuses: the government has approved the January adjustment by regulation, while the bonus requires Parliament to pass an amendment to the pension insurance law. Finance Minister Alena Schillerová said the government plans to add it to legislation already before the lower house.

Every pension includes a basic amount and an earnings-related amount. From January, the basic amount will rise by CZK 270 to CZK 5,170 a month for all recipients. The earnings-related portion will increase by 0.2 percent.

For someone receiving the average old-age pension, that second increase works out to about CZK 34. Together, the two changes bring the average monthly rise to CZK 304. Individual increases will vary because the earnings-related portion differs from person to person.

Minimum pension amounts will also rise. The new minimum will be CZK 5,170 for old-age pensions and third-degree disability pensions, according to the Labor Ministry. The minimums for other disability, survivor and orphan pensions will increase by differing amounts.

Juchelka said the government chose an additional single payment because the average pension is expected to fall relative to the average gross wage next year. The ministry projects that ratio will decline from 41.9 percent to 40.2 percent.

“We agreed in the coalition that pensioners will receive an additional CZK 2,000 as a one-time payment,” Juchelka said, according to iDNES.cz. He argued that a single payment would put less lasting pressure on the budget than adding the same support to monthly pensions.

The ministry estimates the annual pension increase will cost CZK 10.3 billion in 2027. About CZK 9.2 billion comes from raising the basic amount, with another CZK 1.1 billion for the increase to earnings-related amounts above the legal minimum.

Pensioners can expect the approved monthly increase in January. Whether and when they receive the separate CZK 2,000 payment depends on the proposed legal change passing Parliament.