Caja de Profesionales delivered to the government a draft law with a report on the measures to improve the situation facing the institution
– The Caja de Profesionales formally closed yesterday, Thursday, the four-month period of intense work and exchange between government technicians and the institution by delivering into the hands of the Minister of Labor and Social Security, Dr. Pablo Mieres, the bill that seeks to provide a short-term solution with measures to improve the current situation.
— Mieres defined the measures taken by the Fund as “brave”. “There was a very deep, intense and permanent dialogue between the Board of Directors of the Caja de Profesionales and the Executive Branch. I reaffirm the courage and work capacity of this directory of the Professional Fund that took the reins of the issue”, said the minister.
– The proposed measures embodied in this bill were approved by a majority in the last board of directors of the institution with 5 affirmative votes out of seven. In this way, the institution begins the information process for the different parliamentary benches with which the first contacts have already been made.
The Board of Directors of the Caja de Profesionales gave the government a presentation yesterday Thursday summarizing the actions that have been carried out since the new authorities took office -in December 2021-, with measures to improve the economic and financial situation of the Institute and provide “a more comfortable framework to achieve sustainability in the short, medium and long term.”
Minister Pablo Mieres was the one who received the draft and appreciated the attitude of the Fund’s board of directors in having made those decisions that he admitted are “complex” to make in times of crisis.
“When there is a crisis, it is not easy to take these measures and, nevertheless, they have put their chests to the bullets and there has been a very deep, intense and permanent dialogue between the Board of Directors of the Caja de Profesionales and the Executive Branch,” said Mieres. .
He assured that the dialogue between the two organizations “has been very fruitful, very frank and courageous, since it is not easy to present proposals that face a crisis situation.”
Inherited and serious situation
Mieres argued that the current situation was “inherited” because in previous governments “this situation was allowed to run in an irresponsible way.”
“Social security problems do not arise from one day to the next, they are generated and there were decisions that were taken that generated a process of financial and patrimonial deterioration that put the Fund in a very serious situation that forces it to take these measures ”, recounted the minister.
And he added: “This example that we have today of the Caja de Profesionales is an additional factor that indicates how important it is that a social security reform be done on time. Here we are acting in the face of an imminent crisis situation, it is not the best situation, but it is the one that touched and I reaffirm the courage and work capacity of this board of the Caja de Profesionales that took the reins of the issue”.
In this sense, in February 2022 the Caja de Profesionales began to take the first resolutions aimed at reducing expenses, eliminating extraordinary benefits that had been granted above the legal percentages and that it was no longer economically viable to continue maintaining them.
In June 2022, together with the Executive Power, a “working group” was created to study the modification of Law 17,738, with measures aimed at seeking immediate solutions, called “express law”.
From that date to December 22, 2022, multiple work meetings, exchanges, and evaluations were held, which culminated in the approval of a battery of measures by the Board of Directors by a majority of five affirmative votes and two negative votes.
Once the measures to be taken were approved, a draft law was established, which yesterday Thursday was delivered to the Minister of Labor.
Within the affirmative votes are those of three directors elected by the assets and two from the Executive Branch and within those who voted negatively there is a director of the assets and the one elected by the liabilities.
Measures proposed to the government
Among the measures proposed by the Fund to the Government, for active affiliates it is proposed: increase in the minimum retirement age to 65 years, increase in the contribution rate from 16.5% to 19%, adjustment of the replacement rate to 45% and the increase in the years for calculating the basic retirement salary –take it to 18 years-. On the other hand, it creates a new fictitious salary scale for new affiliates that will become 15 categories with changes every 2 years, instead of the 10 currently in force.
In the case of liabilities, it is proposed to create a pecuniary contribution rate for liabilities.
The Fund also provides a basis for each of the measures and how they will affect the situation of the institution.
“The Fund is very clear about the behavior of the different groups. The Institute evaluates the sensitivity of each measure and how it would affect the objective of the modifications and we are convinced that these are the most appropriate measures for the current moment,” said Virginia Romero, president of the Caja’s Board of Directors, aware that all measures will have an impact on the institution.
“What we did was an executive presentation of the actuarial studies that the Fund carried out and there the degree of financial leverage that is extraordinarily needed is evaluated.” “In the working group and together with the Executive Power, the best alternative to cover it is being sought,” said the president of the board of directors.
He added that the Executive Branch “continues to insist” that the contribution rate, instead of being 19% -as the Fund has proposed- gradually rise to 22.5%, “but all the studies we have carried out establish that the objectives will not be achieved if these levels of growth in the contributions to the assets are reached”, said Romero.
He also indicated that the next step is for “the Executive Power to send the bill to the Legislative Power for discussion and final approval.”
“We know that the parliamentary stage will be another instance of work, which unfortunately has been left for the year 2023, but we are confident of the high sensitivity of that body for a quick resolution of it,” said Romero.
