Due to persistently high inflation, the pivotal index has been exceeded for the second time in five months. That means social benefits, pensions and civil servants’ wages will rise again by 2 percent in the coming months. This is according to figures from the statistical office Statbel.
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Inflation – which indicates how much more expensive life has become – stood at 5.71 percent in December. Just like in November, when inflation stood at 5.64 percent, it’s the highest level since July 2008.
High energy prices in particular are driving inflation. Natural gas, for example, is now almost twice as expensive (+97 percent) as in December last year. Electricity has become 44 percent more expensive, domestic heating oil a third. Diesel and petrol cost more than 22 percent more than in December 2020.
The largest year-on-year price decreases are among others TV equipment (-11.5 percent), software (-8.2 products), smartphones (-5 percent) and cocoa (-5.2 percent). Inflation without energy products was 2.35 percent in December, compared to 1.88 percent in November.
Once the pivot index is exceeded, as is now the case, distributions and wages rise. For social benefits, that will happen in January 2022 and for government employees in February 2022. They will be adjusted by 2 percent to reflect the increased cost of living.
The Planning Bureau had predicted the second exceedance since August. In fact, it expects the pivotal index to be surpassed again in August 2022, after which social benefits and wages of government employees would be indexed for the third time in 13 months.
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