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This Tuesday, the Constitutional Commission of the Chamber of Deputies and Deputies approved the idea of legislating the project to withdraw a second 10% of AFP funds.
In conversation with channel 24 Hours, the director of the Center for Longitudinal Studies and Surveys of the Pontifical Catholic University and former leader of the Presidential Advisory Commission on Pensions convened by President Michelle Bachelet, David bravo, expressed his concern about the progress of the project since, according to his diagnosis, it will significantly affect current and future pensions.
“If that second withdrawal materializes, I think we will have to stop thinking that in Chile we are going to have a dignified, decent pension system, or whatever you want to call it,” he said.
: Second withdrawal of 10%: How is the project and who benefits Read more
In the words of the academic, this new retreat, “It creates a very similar situation for us and consolidates the most important fall in pensions that has been recorded in such a short period in our history.”
The expert pointed out that “the damage that has been generated in future pensions is of such importance that it has not been assessed by parliamentarians who say that the reform is a priority and with retirement these funds are decreasing.” He added that “unfortunately the reform has been delayed, the different governments have not been effective to implement it, President Bachelet sent a reform very late in her term and the reform that President Piñera sent is under discussion in Congress.”
Bravo also explained that with the first withdrawal, there are already many people who ran out of balance in their individual capitalization savings accounts and with this second withdrawal, “Not only will pensions not have improved, but they will be deteriorated even more. The deterioration in pensions will be significant as a result of these parliamentary motions.”
Although he maintains that the Government has been slow to implement benefits for citizens in the midst of the economic crisis accentuated by the pandemic, for the professor, “The important measures that must be taken, which are painful, such as increasing contributions and putting in more State resources, are going to be to recover this loss of resources as a result of withdrawals.”
As a result of the above, Bravo thinks that Parliament is taking “Little thoughtful measures are getting worse product in these months of the action of this initiative”.
In short, the academic affirms that a new retirement “seems to me to be a totally wrong policy. Of course, the fall in income requires compensatory measures and that they are effective (…) it is an unreflective, myopic measure, which does it is to pray the pension system, not the AFP system. The future of a generation of people is being mortgaged as a result of a measure that should never have been taken. “
: Constitution Commission generally approves withdrawal of a new 10% Read more
Study warns that 4 million people would remain $ 0
The analysis, made on the basis of a representative sample of those affiliated to the pension system as of 2016, also shows that women would be the most affected group. Of the 4 million affiliates who would be left without savings in their accounts, 57.7% correspond to women, which is equivalent to 2.3 million people.
Read more
New 10% withdrawal: Jiles promises to “do what it takes” to receive money at Christmas
Likewise, the affiliates who would be left without a balance are characterized by belonging to the lowest income deciles.
According to Ciedess’s analysis, the most complex thing would be that of the four million affiliates that would have no balance in their individual accounts (35% of total affiliates), one million could not have access to the Solidarity Pillar once they retire. That is, 25% of the four million affiliates.
According to the socioeconomic characterization of the latter affiliates, about one million belong to the 4 deciles with the highest income (26.5% of the affiliates who would be left without a balance) and almost 3 million belong to the 6 deciles with the lowest income ( 73.5%).
The foregoing is of special relevance, since considering the targeting criterion of the Solidarity Pension System (60% more vulnerable), the first group would be excluded from their benefits, if they did not continue contributing and would not have pensions in the future, and the second group would imply a higher tax burden for the State.
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