Recently the government of President Piñera announced a bill of reform to the pension system, highlighting mainly the 4% additional to the contributions from the employer that will be applied gradually from here to 8 years. In short, it means that the contributions will go from 10% to 14% in full to 2026. There will be more competition in administering this additional 4% by other entities other than the AFP´s, however, it is unclear whether or not an additional fee for the administration of the additional fee will exist, but what happens to the current pensions of Older adults?
On the other hand, once a year the state makes the delivery of a winter bond fixed to the year 2019 in $62,700, which extends to more than 1,262,000 seniors. This bond is delivered along with the pension for the month of May and maintains as a requirement to have 65 or more years of age (related to age in men and not women) and perhaps the most critical to receive an internal retirement to $161,680.
If we analyze in depth, the number of people with low pensions in Chile exceeds 1.2 million considering that they also do not receive this bond adult women older between 60 to 64 years with lower pensions, pensioners by law Valech and older adults ex Coal workers. And if we run the reflection on pensions below the minimum wage, the total number of seniors over 65 years with a pension greater than $162,000 but less than the current legal minimum wage must be included. Clearly the bond does not improve the quality of life in the medium and long term.
Our country is ageing in an accelerated way, only in the last 25 years the elderly population has grown by about 70% and the INE projection is that at 2050 1 of every 3 Chileans will be elderly.
We are at the bottom of the list in OECD countries with lower pensions, with more inequality replacement rates in addition to men and women. Within the necessary proposals in my opinion is the establishment of an ethical floor to match at least the minimum pension of an older adult compared to the current minimum wage, where the powers of a mixed system of savings improve co-responsibility, the pillar Contribution and increase in the percentage of savings in the cap of capitalization, at least, incorporating also the redistribution of saving to consumption where a worker or retiree has the right to make a transfer between the present and the future on what Belongs. In turn, talking about an older adult’s ministry should not be left in anyone’s imagination, Chile must move forward but really.
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