Pension provision

Pensions, young people need funds

Low incomes, combined with the new rules for calculating age and allowances, make it indispensable for young people to focus on supplementary contributions

by Margherita Ceci

3 December 2025

3' min read

Translated by AI

Versione italiana

Key points

The weight of families
Covip and government proposals
The unknowns

3' min read

Translated by AI

Versione italiana

The first pillar limps along and asks the second to support it. But the latter also needs a stick, because those who should be supporting it and to whom it should be most useful - the young - are not put in a position to do so, between low salaries, precarious jobs and the rising cost of living.

It is no coincidence that the growth in supplementary pensions in recent years is mainly due to older members. The average age of pension fund members at the end of 2024 - according to the latest figures from Covip (the pension fund supervisory commission) monitoring - is 47 years (in 2019 it was 46.6). Of the almost 10 million members, theunder 35 are less than 20 per cent. And they weigh most heavily in the 'other members' category (mainly under 15 years): these are non-working and tax-dependent individuals, children whose parents have opened a social security position.

The Weight of Families

In short, the growth of the second pillar is not coming from the labour market, but from families, and it is still the older age groups that are 'pulling the strings'. And it is here that the real issue opens up: supplementary pensions are a form of investment that is especially favourable to the so-called 'strong workers': those, that is, who have an income, pay Irpef and can draw an immediate benefit from tax relief (annual deduction of up to 5,164.57 euros).

Added to this is the issue of the thresholds for contributory retirement. Trade union sources recall how, after the Fornero reform, the minimum required amounts are, for many intermittent workers or those on low wages, very far off: even if you pay, you do not reach the threshold. Those on poor incomes risk retiring late and with a meagre cheque. In addition, for those who are under EUR 8,500 per year - about 4.5 million workers, often part-time women - the deduction from income does not generate any benefits since the tax is already set at zero by the no tax zone.

The proposals of Covip and the Government

In a scenario of this kind, the proposal brought forward by the Covip is to shift the centre of gravity to the new generations, with the creation of abirth pension piggy bank (see Il Sole 24 Ore of 26 November). A measure that aims to broaden the number of members but also to rebalance participation in a country divided in two between North and South, and that could see the light as early as this financial year.

Among the 'flagged' amendments to the Budget Bill is the one, first signatory Lavinia Mennuni (Fratelli d'Italia), which proposes the establishment at the INPS of a Youth Welfare Fund, intended for newborns from 1 January 2026. In practice, parents or family members will be able to activate the fund within the first three months of the newborn's life, by means of a payment of at least 100 euro, to which the Inps will add another 50. It is necessary to wait for Parliament's approval and, in any case, the details will be left to a ministerial decree of Labour, in agreement with the Mef and after consulting the Inps and Covip. The idea is that this sum could become the basis of the supplementary pension position; even if the beneficiary is granted the right to redeem the position when he or she reaches the age of 18 (essentially, for the purpose of study, training or starting a business), which could nullify its accumulation function.

The unknowns

The question, however, remains open: will these newcomers be able to continue paying into the supplementary pension scheme tomorrow? And what about those who are called upon to support the contributory system today? Questions that are anything but secondary, if we consider how recently the Senate reminded the government that the pension of the younger generations 'will need the integration of the second pillar' (G/1689/6/5). Not an option, in short, but a necessity. An imperative that, the trade unions recall, risks penalising precisely the most fragile workers.

Further complicating the picture is a cultural factor affecting the capacity of the funds. When it comes to redeeming one's supplementary pension, the choice of lump sum settlement prevails, an option that 'empties' the funds and circumvents the purpose for which one should have saved, namely to benefit from a second pension. According to the experts, the real change of step will occur when families begin to see the first pensioners in a contributory regime only. This is a worrying step, because public pension expenditure will tend to shrink and supplementary pensions will be increasingly called upon to contribute to the country's social welfare, trying to stem poverty in old age.