Hungary plans major pension reforms and minimum increase

Hungary is planning significant changes to its pension system. Starting January 1, 2027, the government intends to raise the minimum old-age pension from 28,500 HUF to 120,000 HUF. Additionally, a tiered increase is planned for pensions below 146,000 HUF to ensure that lower-income retirees receive relatively higher growth.

Annual pension increases are scheduled for every January, with the amount determined by projected consumer price inflation. While the 2026 increase was set at 3.6%, the exact scale for 2027 remains subject to the final budget adoption.

Experts and international organizations have raised concerns regarding the long-term sustainability of the system. The OECD has warned that pension expenditures as a percentage of GDP could rise significantly due to an aging population. In response, pension expert András Farkas has suggested potential reforms, including a temporary reduction of the retirement age to 64 until 2035 to account for lower life expectancy in certain demographics, and modifications to the ‘Women 40’ benefit to ensure actuarial balance.