Italy Spends a Larger Share of GDP on Pensions Than Any Other EU Country

What the table adds up

Each value here is one country's spending on pensions in a year, divided by its gross domestic product (GDP), the value of everything its economy produced in that year. The word pension is taken broadly. The total covers old-age pensions, including those drawn early or only in part, and also disability pensions, survivors' pensions, which are paid because of a relationship to someone who has died, and early-retirement benefits granted for reduced capacity to work or for labour-market reasons.

Every Member State reports these benefits to Eurostat on shared definitions, the framework known as ESSPROS (the European System of integrated Social Protection Statistics), so that a pension paid in Lisbon and one paid in Tallinn fall into the same categories. Pensions are counted gross, before any income tax or contribution the pensioner pays on them, and whether or not they depend on a test of the recipient's means.

Who spends most and who spends least

For the Union as a whole the bill came to 12.62% of GDP in 2024, a value Eurostat flags as provisional, which means it may still be revised. That is the latest year in the table and the one the main ranking uses. Italy spent the largest share, 15.91%, followed by Austria at 15.56% and France at 15.06%, the only three Member States at 15% or more. Finland at 14.46% and Greece at 14.09% are also above 14%, and Belgium at 13.46%, Spain at 13.23% and Portugal at 13.00% complete the eight above the EU figure.

At the bottom, Ireland spent 4.04%, Malta 5.08%, Hungary 7.04%, Lithuania 7.38% and Cyprus 7.56%: five Member States below 8%. Italy's share is a little over three times Malta's and 11.87 percentage points of GDP larger than Ireland's, a ratio and a difference worked out here rather than published, as are the counts of countries throughout this page.

Why most countries sit below the EU figure

Eight Member States spend more than the EU figure and nineteen spend less. The five closest below it are Germany at 11.83%, itself a provisional value, Poland at 11.61%, Denmark at 11.38%, the Netherlands at 11.18% and Sweden at 10.81%.

The EU value is not a simple average of the 27 national shares. Counting every country once, that average comes to 10.64%, about two points below the EU figure; it is calculated here and appears nowhere in the table. The gap is consistent with a figure for the Union taken as one economy, in which a large country counts for more than a small one. Germany, France, Italy and Spain, the largest economies in the Union, all sit above that unweighted average: Italy first in the ranking, France third, Spain seventh and Germany ninth.

Thirteen countries under ten per cent

Thirteen Member States spent less than 10% of GDP on pensions in 2024. Twelve of them are among the thirteen countries that joined the Union from 2004 onwards: Slovenia at 9.99%, Bulgaria at 9.64%, Slovakia at 9.45%, Croatia at 9.36%, Romania at 9.09%, Czechia and Latvia at 9.03% each, Estonia at 8.67%, and Cyprus, Lithuania, Hungary and Malta. Poland is the one country from those enlargements above the line. Ireland, a member since long before them, is the thirteenth.

A low share can mean smaller pensions, fewer people drawing them, or simply a large output to divide them by. This ratio does not distinguish between them, and the table offers no way to tell which applies where.

From 2013 to 2024: more falls than rises

Every change quoted from here on is one published share minus another, computed here, and the counts of countries rising or falling are made from those differences. Across the whole table, from 2013 to 2024, the share fell in 15 Member States and rose in 12. One of the falls, Hungary's, spans a break in its series in 2015, Eurostat's flag for a change in sources or method that leaves the values before and after not fully comparable. The EU figure went from an estimated 13.15% to 12.62%, 0.53 points lower, and declined in every year from 2013 to 2019.

Ireland fell the most, by 3.89 points, followed by Malta at 3.20, Greece at 2.83 and Portugal at 2.64. Greece is the story at the top of the table. It spent the largest share in the Union in every year from 2013 to 2018, reaching 17.84% in 2015, the highest value any Member State records in the table, and in 2024 it was fifth, behind Italy, Austria, France and Finland. Italy moved into first place in 2019 by three hundredths of a point, 15.83% against 15.80%, and has held it in every year since.

Malta's share fell in nine of the eleven yearly steps the table covers, from 8.28% in 2013 to 5.08% in 2024.

Twelve Member States went the other way. Finland rose the most, by 1.46 points to 14.46%, ahead of Luxembourg at 1.24, Belgium at 1.22 and Estonia at 1.21. Slovakia and Bulgaria also rose by more than a point, and the remaining six by less.

Where the comparison ends matters. Measured from 2013 to 2023, nineteen Member States had fallen and eight had risen; one more year of data moved Austria, Germany, Lithuania and Romania from the first group into the second.

What 2020 shows about a ratio

In 2020 the share rose in 26 of the 27 Member States, Ireland the exception, and the EU figure jumped from an estimated 12.59% to a provisional 13.53%, the highest value in its series. Spain rose by 1.76 points, Italy by 1.70 and Greece by 1.67. In 2021 the share fell in all 27, Italy's the most, by 1.34 points.

A movement that uniform, up everywhere and then down everywhere, is what a ratio does when its denominator, GDP, shifts across the whole Union at once, and 2020 was the year the pandemic interrupted economic activity across Europe. It is not evidence that 26 governments raised pensions in the same year. The table publishes the ratio and neither of its two terms, so it cannot show how much of any year's change came from pensions and how much from GDP.

Rising again since 2022

The EU figure fell to its lowest value in the table, 12.22%, in 2022, then rose in each of the next two years: by 0.09 points in 2023, when the share went up in 17 Member States, and by 0.31 points in 2024, when it went up in 21 of the 27. The 12.62% of 2024 is the highest EU value since the 12.78% of 2021.

Austria rose the most in 2024, by 1.12 points to 15.56%, the highest value in its own series and the largest one-year rise any Member State records outside the step from 2019 to 2020. It moved from third place to second, ahead of France. Poland and Slovakia both rose by 0.80 points, Romania by 0.79 and Finland by 0.73, enough to take Finland past Greece into fourth place. Six Member States fell, none by more than Ireland's 0.20 points; the other five are Czechia, Denmark, Malta, Hungary and Cyprus.

Why Ireland's figure is so low

Ireland has had the lowest share in the Union in every year from 2015 to 2024. Between 2014 and 2015 its value dropped from 7.38% to 5.57%, a fall of 1.81 points and the largest one-year fall of any Member State in the table. Which side of the fraction moved is beyond what this table can show, but the likeliest explanation lies below the line. Ireland's output is swollen by the accounts of multinational groups that hold patents and book profits there, earnings that bear little relation to the incomes of people living in the country, and dividing anything by that output makes it look small. The 4.04% is the published value and stays in the ranking, but it is a share of an output that overstates the domestic economy, not a measure of what Irish pensions are worth.