Union of the AFPs warns of “risks” to the pension system with legislative projects

The former Minister of Economy, David TuestaHe pointed out that “there are legislative bills that would destroy the pension system in Peru,” which would leave citizens without sustenance for old age.

“In this new Congress, which has only been in operation for three months, at least seven bills have already been presented on the subject of pensions. And it is powerfully striking that they insist on two initiatives that were already rejected by technical entities and rejected in the previous Parliament, which presented similar and populist proposals, “said the also advisor on public policy issues of the AFP Association in a press release sent by the union.

Tuesta referred mainly to the legislative initiative recently presented by the Podemos Peru party, which seeks the free disaffiliation of the Private Pension System (SPP) and incorporates a new savings mechanism for pension purposes in the financial system.

“This bill eliminates the obligation to save to have a retirement pension. What guarantees us that an affiliate who withdraws his money to pass it on to a financial institution that manages pension accounts, or vice versa, chooses not to do so and spends his savings for the future? Thus, we would be destroying the pension system in Peru ”, he said.

The guild once again defended the system from AFP, by ensuring that mandatory pension savings are important to prevent contributors from falling into poverty at the end of their working life.

“In addition to leaving citizens without pensions for their old age, the elimination of mandatory pension savings would affect the entire country because it is one of the main sources of domestic savings, which generates investment, sources of work and provides stability to the economy. As of August 2021, SPP funds represent 16.8% of Gross Domestic Product (GDP) and 91.0% of domestic savings. That should not be destroyed ”, he specified.