Bazán on pension reform: “The ideal would be a joint text, but there are substantial differences”

There are three proposals that, to date, seek to reach the plenary session of Congress and that propose a reform of the Peruvian pension system. These belong to the economy commission of the legislaturethe multi-party commission of the Executive already the work commission -also of the Legislative-. The latter, chaired by congresswoman Sigrid Bazán, is the one that has an opinion approved to date.

However, it is a commission that does not have priority over the discussion. This was recognized by its headline in a press conference given this morning. “We are not the first committee on various bills. We are second commission. This implies that the Economy Commission must do its job to approve its opinion soon -or not-, but allow this issue to reach the plenary session ”said the parliamentarian.

And although he was in favor of dialogue, he recognized that achieving a joint text would be unlikely given the differences in approaches. Faced with this, Bazán said he would wait for the initiatives to be used in plenary session to see which text is approved.

“We have an opinion in the Labor Commission. We regret the delay of the Economy Commission and the Executive to process their proposals and thereby bring them all to the plenary session of Congress. (…) The ideal would be to write a text together. However, we understand that there are substantial differences that would not allow it and we would have to vote to see which text is finally approved.”

Sigrid Bazan, President of the Labor Committee of the Congress.

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The opinion of the Labor Commission proposes the creation of the Universal Comprehensive Pension System (SIUP), which considers three pillars: universal non-contributory, contributory and complementary.

The universal non-contributory pillar grants a universal basic pension to everyone over the age of 65 and is financed from the budget of social pensions such as Pensión 65 and the “Contigo” program. With this, the State manages and finances this first pillar.

The contributory pillar is divided into two subpillars: for dependents and independent. In the case of dependents, the contribution is 9% while the employer contributes 2% and the State 1%. Progressively, the employer’s contribution would rise to 4%. Meanwhile, for the independents, their contribution is 5% and the State the same percentage. The scheme considers income up to the value of 5 RMV. This pillar is administered by the State.

Meanwhile, the complementary pillar is enabled for those who contribute more than 5 RMV and the contributor will have the power to choose whether to contribute to a private or public fund manager. These contributions are those that go to an individual capitalization account.

Additionally, it seeks to grant inspection functions to public institutions for the management of the pension system. Thus, according to the congresswoman, the Sunat would be in charge of supervising the collection. Sunafil is in charge of supervising the benefits and the SBS would have financial supervision.

Asked if these institutions would have the capacity to sustain such functions in addition to those that are already assigned to them today, Bazán considered that they do have them and that they should be strengthened in the long term. “We feel that there is institutional capacity, but without a doubt supervision in all things must be improved and that will go progressively and gradually. We do not seek to have the perfect State, but to perfect it”he asserted.

The vote that approved the Labor opinion was questioned by the parliamentarians themselves attending the session. As recalled, the vote sought to determine positions on a majority and a minority opinion that had the same number of votes. The minority one was approved.

When asked about the opinion that will go to plenary and if it would be presented as a “majority” or “minority”, Bazán said: “There were two opinions. A vote was taken and the opinion that won that vote is the one that remains. There is only one opinion now”.

He asserted that presenting a minority opinion after having rejected the original is part of the powers of congressmen. He denied that there is a duplicate signature, except for that of Congresswoman Lucinda Vela, who also signs as secretary of the commission.