AFP Association proposes initiative to reform the pension system

Last March 17, the Association of Pension Fund Administrators (AAFP) presented to the Congressional Labor Commission, chaired by Congresswoman Sigrid Bazán, a new proposal to reform the pension system. Among the main features, the initiative seeks to incorporate independent workers, provide individual capitalization accounts in the name of each affiliate, implement the return of the IGV, the seed capital for each Peruvian, and expand the right to choose who manages retirement savings. .

Likewise, its objective is to grant a minimum monthly pension to people with at least 20 years of contributions and a staggered one to those who have contributed between 10 and 20 years.

“We propose to include independent and informal workers and improve pensions, with innovative ideas, since currently only three out of 10 workers will have access to a pension. Our proposal universalizes the pension for all Peruvians, regardless of their employment status and income,” said the union’s president, Giovanna Prialé.

What points does the pension reform initiative cover?

According to the Pension Fund Administrators (AAFP)The main points taken into account are the following:

• Matching contribution: for each sol contributed by the member, the Government must contribute an equivalent amount until reaching a minimum pension. This, with the aim of incorporating informal and independent workers who do not have constant savings capacity.

• Refund of 1% of the IGV: 1% of the IGV paid in the year must be returned to each contributor. In this way, pensions and profitability are increased, fostering savings and encouraging formalization.

• Seed capital: The State must establish a fund for each Peruvian born, as a base fund that is capitalized until the person reaches 65 years of age.

• Increase the number of fund managers: citizens will have more options to choose, opening the pension system to new players with the same rules, that is, separate assets and intangible funds so that savings are protected.

• Creation of a commission for performance: This will be formed as a component associated with profitability to create a new alternative for affiliates.