Pensions in Czechia to rise by 304 crowns in January — less than the minister promised in spring

Starting January 2026, the average pension in Czechia will rise by 304 crowns — even though back in March, Labour and Social Affairs Minister Marian Jurečka called a 300-crown increase "too small" on Czech television. At the time, he said he was hoping for a more substantial reform of the pension indexation formula.

What was promised versus what actually happened

The government's programme declared an intention to change the pension valorisation formula. The current calculation method was introduced by the previous cabinet of Petr Fiala (ODS) and has been in effect since January 2024; it counts one-third of real wage growth toward pension increases. The current coalition had promised to raise that share to one-half — back in spring, Jurečka presented this change as part of a forthcoming amendment to the law.

The provision for the shift to one-half did indeed appear in the ministry's draft, but disappeared from it over the summer following objections from the Ministry of Finance. The government postponed introducing the new formula. Finance Minister Alena Schillerová (ANO) explained that, given the earlier drop in real wages, the effect of the change would only have materialised several years down the line anyway.

As a result, the average pension will rise by 304 crowns starting in January. Of that, 270 crowns comes from growth in the base portion of the payment under the standard statutory indexation mechanism. On top of that, the government raised the percentage-based component of the pension by 0.2 percent, adding roughly another 34 crowns for the average pension.

A one-off bonus of two thousand crowns

In addition to the regular indexation, the government plans to pay all pensioners a one-time bonus of two thousand crowns. Estimates suggest this measure will cost the state budget several billion crowns, and the opposition has already criticised it as a populist move to win over voters. However, the payment still needs to go through the approval process before it can take effect.

Other promised changes to the pension system — such as age-based valorisation for citizens over 80 and increased pensions for continuing to work after retirement age — are included in the amendment to the law currently under discussion.

Source: novinky.cz