The recent announcement about the increase in the Universal Guaranteed Pension (PGU) has generated great expectations among millions of Chileans. The Senate Labor and Social Security Commission approved, ad referendum, the proposal to increase this benefit to $250,000, from the current $214,296. This change seeks to improve the quality of life of older adults, giving them a greater capacity to cover their basic expenses.
What does the increase in the PGU imply?
If the proposal is approved increasethe PGU will be adjusted annually in accordance with the Consumer Price Index (CPI), guaranteeing that its value maintains purchasing power against inflation. This increase is part of a series of pension reforms promoted by the Government to strengthen the pension system and ensure a more dignified retirement for older people.
The proposal also includes new functions for the Pension Advisory Council (CCP). This body must periodically review the amount of the PGUensuring that it is sufficient to cover the basic expenses of the beneficiaries. According to the Ministry of Labor, every four years the CCP will carry out an analysis based on indicators such as the poverty line, the remuneration index and economic growth, to determine if the amount remains adequate.
Requirements to access the PGU
The requirements to access the PGU remain without significant changes. Beneficiaries must be 65 years old or older, not belong to the richest 10% of the population, and prove residence in Chile for at least 20 continuous or discontinuous years from the age of 20. In addition, it is necessary to have resided in the country for 4 of the last 5 years prior to the application and have a base pension of less than $1,158,355 (value in force since February 2024).
The increase of the PGU It is just one of the measures included in the pension reform that the Government seeks to dispatch from the Senate before January 2025. Among the approved modifications are the transition to generational funds, changes in pension collection and simplified mechanisms for independents.
