The system that controls that voluntary members do not make atypical contributions that could inflate their pensions at the time of retirement has already entered into force and is being applied without problems, assured the director of membership of the Ecuadorian Institute of Social Security (IESS), David Narvaez.

The official revealed that even the scheme, which was scheduled to come into effect on August 15, passed on August 5 ahead of schedule. The decision establishing this change was made in April 2023, but in it the Management Board determined the operational part and predicted that the system should be ready by September.

Voluntary branch contribution control: “Most will feel no change, control is for atypical increases five years before retirement”

“The system went into effect a few days before the specified date, we were able to resolve some inconveniences that we expected to occur; however, they did not occur in technological problems, “explained Narváez.

This system places caps on the salaries that voluntary members can contribute, ranging from 300% of the base amount, which is $450 ($1,350), to 600% ($2,700), depending on years of contribution. This, after Narváez assured that there were cases in the past where a branch that normally paid contributions above the basic salary continued to pay more than $40,000 for three months and thus managed to raise his pension to more than double what he would have received. .. reciprocated if he did not make atypical contributions.

Contribution caps already in place

Meanwhile, regarding the first results of the new system, the official assured that there have been no inconveniences or claims for the application as it is not a frequently repeated situation. From 2021 to today, the entity has discovered 80 cases.

“The population will not feel it because this is only for those who try to make this atypical change in the contribution bases,” explained Narváez. He emphasized that the public was quite aware of the changes being undertaken, although he acknowledged that several branches had approached for consultation on the details of the system, but also assured that concerns had been resolved so far.

“The system works well, controls are carried out and those who enter the system have no problems, they join without any problems,” added the director of Affiliation (a) IESS.

The reform proposed by the Interinstitutional Commission for the IESS Pension Fund will go to another commission for review

The application of the system arose from the verdict of the Constitutional Court of April 28, 2021, which ordered the IESS to implement control measures for atypical contributions. This is because there are people who come with the trend of contributing to the basic salary, but who with very high contributions in recent months manage to have maximum pensions. This means that the corresponding fund is not accumulated and pensions are not so realistic.

Meanwhile, Narváez announced that there will be monthly checks on the system’s implementation to confirm that it is optimal.

Half of the volunteer members are 55 or older

The total number of voluntary members is 217,126 people, and these are their ages:

There is a greater number of voluntary members in the age range of 55, because they know that at the age of 55 and 15 years of contributions, they will be able to retire, said the director of the Association (a) of the Ecuadorian Social Security Institute (IESS), David Narvaez.