For the director of the Workers at the Social Security Bank (BPS), Ramón Ruiz, it is “nonsense” to increase the retirement age as proposed in the draft of the social security reform project that President Luis Lacalle Pou delivered to coalition leaders.
On Twitter, Ruiz argued that “in the countries where the retirement age was increased, unemployment increased and the vast majority of workers were left without income and without social protection.” In this regard, she told The Observer that this “does not solve the challenges” that social security has in Uruguay.
“What inspired the government to install a commission of experts to analyze the pension system was the sustainability of the systembecause [estamos bien en cobertura y suficiencia]. In Uruguay, state assistance for social security amounts to approximately one point of GDP. It can be debatable whether it is reasonable or not; the government understands that the financial assistance received by the different social security institutes in the system must be lowered”, analyzed the BPS official.
In countries where the retirement age was increased, unemployment increased. and the vast majority of workers were left without income and without social protection.
– Ramon Ruiz (@ert_ramon) July 29, 2022
Thus, he insisted that, if that is the “concern”, instead of discussing the retirement age it should, for example, put on the table how social security is financed. To do this, you can search for “new sources” or “make transparent” some of the existing ones or “those we decided not to have”.
Unemployment and health
Meanwhile, Ruiz argued that the increase in the retirement age would generate more savings, but it would end up being invested in unemployment insurance, since it would also lead to an increase in the number of workers covered by that tool.
“Uruguay’s labor market expels workers over 60 years of age to unemployment and lack of social protection. So, even if he wanted or had the opportunity to work (because he is healthy), the business culture we have does not allow them to have job stability. That was not studied properly.”Ruiz lashed out.
Along these lines, he also clarified that if what was proposed “worked ideally” and all employees worked until they were 65, those under 25 “will have problems” since it will make it even more difficult for them to access the job market.
On the other hand, he stated that “many workers” will not be able to retire at 65 due to “health problems”, but rather they will end up retired due to illness before reaching that age. “What is going to be the injustice that is being committed with this reform? That it is being proposed that these disability pensions, instead of being paid at a 65% replacement rate, will be paid at a lower replacement rate, that is, they will have a reduction in the amount of retirement,” argued the director of the BPS.
Finally, he regretted that Lacalle Pou had not presented the draft of the project to those who “we are going to pay the piper, to suffer the consequences” of the reform of “cuts and setbacks”. The director for the workers affirmed, in this way, that still does not know the draft, which he described as “sloppiness and lack of respect and of consideration” with the sector that it directs.
