Ernesto Murro from 1992 to 2001 represented the workers at BPS. From 2005 to 2015, during two administrations of the Broad Front (FA), he presided over the Social Security Bank. From 2015 to 2020 he was Minister of Labor and Social Security and in 2021 he represented the FA in the Commission of experts that analyzed the social security reform
First conclusions of the work of the commission of experts on social security during 2021?
The commission made up of 15 members worked intensely, throughout the past year 2021. A diagnostic report of more than 300 pages and recommendations of more than 100 pages were produced. Beyond the fact that we do not accompany these reports, without a doubt they are important and intense documents, there is a lot of work in them, delegations, international experts were received, and documents were prepared. There were times when we were excluded, two or three months, when the recommendations were made. In the final stage, 9 members of the government coalition met. They prepared the document that was finally approved by a majority, without the votes of the FA, the PITCNT, or the Organization of Retirees and Pensioners (ONAJPU).
There is a difference between what the government says publicly and what is written in the prepared document.
The government has proposed a progressive increase in the Retirement Age, not modifying the contributions of either employees or employers. Does the FA not agree?
There is a difference between what the government says publicly and what is written in the prepared document. It is noteworthy that after a year of intense work preparing very important documents, 6 months after the completion of the work, it is strange that they have not been able to write the articles of the bill. All that material that they worked on, drafted and approved, why in 6 months could they not make the bill? This is a fundamental question. The government, which seems interested in reaching a consensus, has plenty of votes in both houses to approve the project it wants. In six months the draft law has not appeared, what there is is a document of recommendations from last November. There is an increase in years of work when sweeping. They propose increasing years of work and years of age for a group of people, to whom the current president of the Republic (Lacalle Pou) had told him that he was not going to increase the age (of retirement). People who are working today were told that their age will not be increased. Today we could tell a million people who are working that they are going to raise their retirement age. Then statements appear where it is said that certain cases will be dealt with. There is an increase in ages when sweeping and years to access, for example, widow’s pensions. when it says “the contribution rate is not increased”It is true, but if I have to work more years, if I have to be older to access retirement, I will contribute more. I will contribute more years and more money. If you add the “voluntary savings”which already exists today, although it does not work, has failed in Uruguay and in all countries, what does the “voluntary savings”? in addition to 15% of the contribution of the workers, which is one of the highest in the world. The workers are going to be asked, the employers have already stated that they do not want to, each time they want to contribute less and ask for more exonerations. The workers will be asked for more contribution for that “voluntary savings”, according to what they propose, will be a complement for retirement. All this of contributing more years, of work and of age, even if the contribution rate is not modified, it will be for a worse system. They not only propose making people work for more years, but also for a worse system. It is not that all the new workers of all the savings banks will go to the current mixed system with AFAP, but rather that they will go to a worse mixed system with AFAP, to collect a lower retirement amount.
If they want to make the reform (of social security) they can do it, they have plenty of votes. They have had time to prepare a bill, why don’t they do it?
Does the Retirement and Pension Fund need to be reformed?
It is necessary to make reforms permanently, it is what we did in the 15 years of the FA government, we reformed the Banking Fund, the Police, the Notarial, Retirement and Pension Funds, and the Military, for example reducing from 35 years of work to 30 years to retire, improving minimum pensions, which we tripled. Today people complain because they charge 15,000 pesos, but if we had not done what we did, they would be charging between 5,000 and 7,000 pesos, 60,000 women agreed to retirement, we reformed unemployment insurance, family allowances and the National Health System. We made many reforms and we are supporters of them. 500,000 people were incorporated into social security. We made those reforms, and in almost all of them, the current members of the current government coalition did not support them. For example, the Caja Militar, it is essential to deepen the reform, we did in 2018 the reform that we could do, not the necessary one. Just with the FA votes, who were the main critics for doing less than we did? The current President of the Republic (Lacalle Pou) at that time a senator, and the current Minister of Defense (Javier García) at that time a senator, who held meetings in the barracks. If they want to make the reform (of social security) they can do it, they have plenty of votes. They have had time to prepare a bill, why don’t they do it? I think there are internal issues of the coalition in the government that are weighing.
The Uruguayan protection system, beyond criticism and the improvements it needs, is the best social security system in Latin America.
According to the Uruguayan demographic reality, the changes in the world of work, the poor are children and adolescents, and not older adults. Should we think about social sustainability involving these children and adolescents? , and at the same time that the retirement and pension financial system does not go bankrupt?
There is no good, nice and cheap social protection system. The Uruguayan protection system, beyond criticism and the improvements it needs, is the best social security system in Latin America. Contrasting boys and girls with old men and women is not a good theory. A recent work by CINVE (Center for Economic Research) has just appeared, where it talks about the importance of retirement and pensions for older adults in household income. Uruguay is the country where salary, retirement and pension matters most for people’s lives. Three out of four people depend on their salary and this study shows that if pensions and pensions were removed, it would have a high impact, not only for retirees and pensioners, but also for households. In many households, without retirement or pension, income would be cut in half. This CINVE study surprised the researchers themselves, they did not think that the impact of retirement and pensions on household income would be so great. In the constitutional reform that we promoted and that was approved by 82% of the population in Uruguay, liabilities are adjusted according to wages. There is no need to oppose, it is necessary to see how children and adolescents are cared for, and how the elderly and people with disabilities are cared for. This government has made a silent reform that is underway. In 2020, with more or less a Pandemic, he lowered wages saying that this would take care of employment. That theory that is not proven, although I do not agree, let’s accept it for a moment, could be understandable for workers, because older adults and people with disabilities, the most affected by the Pandemic, why were they lowered the little they they win the vast majority and they were not given any compensatory measure? A person who receives 20,000 pesos per month for retirement, stopped charging 350 pesos per month in 2020 and another 350 pesos in 2021, is 700 pesos less, for a person who earns 20,000 pesos per month, 700 pesos less is a lot. This meant a saving, a cut of 200 million dollars. The President of the Republic (Lacalle Pou) was proud of this because he had saved 600 million dollars, the most affected people were taken from him. The silent reform is already underway and 2022 will be the same, retirement and pensions will lose purchasing power again. They are already making a reform, the worst reform they make if they do it, since they have plenty of votes.
We have to think of new forms of financing, and other countries are doing it. Denmark has a good system, there are no contributions from workers and companies but it is financed with taxes. In Norway, the main source of income, which has existed since 1967, is a fund that they generated by charging taxes on the high profits obtained by oil companies. That retirement and pension fund in Norway is the main fund in Europe
In perspective, do you believe that not making changes will have a negative impact and, at the same time, do you believe that changes must be incorporated for the system to survive?
We have as an example, what we did in 15 years of government (FA). The collection of the BPS doubled in real terms, the financial assistance to the BPS in 2004 was 4 points of GDP, today it is less than 1%, the financial assistance, in some years during our government, was 0. The financial assistance measured in relation to We lowered the wage bill from 10% financial assistance to less than 2%. We incorporated 500,000 people to the BPS and 80,000 companies, we lowered evasion from 40 to 20%. We have to think of new forms of financing, and other countries are doing it. Denmark has a good system, there are no contributions from workers and companies but it is financed with taxes. In Norway, the main source of income, which has existed since 1967, is a fund that they generated by charging taxes on the high profits obtained by oil companies. This retirement and pension fund in Norway is the main fund in Europe and the fourth in the world.
It hurts me that while tens of thousands queued here to eat in a popular pot, it continues to happen today, Uruguayans took out of the country to deposit abroad a whopping 10 billion dollars. This money is two months of national production
Does Uruguay have this type of companies, does the country have companies of this size?
It hurts me that while tens of thousands queued here to eat in a popular pot, it continues to happen today, Uruguayans took out of the country to deposit abroad a whopping 10 billion dollars. This money is two months of national production. Here there were people without work, more than 7,000 Uruguayans dead as a result of COVID, queues to get a plate of food, and there were other Uruguayans who, as a result of their wealth, took out 10 billion dollars. I find it interesting what Comrade Danilo Astori (senator) proposed to put a tax on this money that is outside the country, I propose it to do so in a transitory and temporary way to help finance the difficulties generated by the Pandemic. There are other ideas, 136 countries approved a 15% tax on the 100 largest companies in the world, this was formerly proposed by people on the left, now it is proposed by the most developed countries. We must think of new ways of financing social security so that it continues to be a fundamental human right.
