The entity must go into the hands of its legitimate owners
Since it was created in 1943, the Social Welfare Institute has been a political instrument at the service of the governments of the day. In 1950, the decree-law 1860 granted the Executive Power the exclusive power to appoint a general director at the head of the administrative council. Since then, the Ministries of Health and Labor had direct interference in the management of the institution, giving the employer participation with two advisers and the workers with another two. This has been the case for more than seven decades. Forcing the analogy, we will say that this structure is as if in a public limited company the capital contributed by the private shareholders was managed by the State. And we already know what happens when the patrimony of the State falls into the hands of bureaucrats remotely guided by politicians.
It is essential to advance with the reform of the social security law, which by force of patches has been losing clarity and forcefulness in its purpose of administering the contribution of 9.5% of the worker and 14.5% of the employer on salary of sheet. In 2021, IPS exhibited a net worth of 26.3 billion guaraníes, US$ 3,814 million and coins, figures that are equivalent to those of a corporation of respectable dimensions.
The IPS was never governed by its true owners, those who generate the capital and who must be the direct and sole beneficiaries of the purposes for which it has been established: manage retirement assets and provide a comprehensive health service. There are two very well defined areas, each one of them with its complexity and its rules, with its duties and assets and that therefore require the services of the best professionals that can be obtained.
The management of retirement funds is today a high-profile discipline. It requires not only academic suitability but also the legal framework that allows migrating from a pay-as-you-go system to one of true capitalization in order to give it sustainability.
The health area is even more complex. It is not reduced to bringing together the best doctors and specialists. Requires mastery of hospital hospitality and proper stocking of medications, the most sensitive areas.
And above all, an audit mechanism that guarantees management transparency.
This process must be started as soon as possible.
It’s imperative. Any delay works against you.
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The entrance Urgent, reform the IPS was first published in The Independent.
