The Ecuadorian Confederation of Unitary Class Workers’ Organizations (Cedocut) described it as a “transcendental verdict”. unfavorable opinion of the Constitutional Court (US) on the Decree Law Economic urgency for the balance, organization and transparency of public finances, sent by President Guillermo Lasso on September 5.

The workers’ union pointed out that the verdict of the Constitutional Court “marked a turning point in the defense of the rights of workers, members, pensioners and farmers”.

These are the arguments why the Constitutional Court rejected the decree on the law on public finances

In the project, the President proposed reforms to the Organic Code of Planning and Public Finance and sought to update and reform the processes that enable the operation, management, monitoring and control of the National Public Finance System. Also, according to various trade unions and pensioners’ associations, the decree proposed the cancellation of interest payments owed by the state to the Ecuadorian Social Security Institute (IESS).

In its verdict, the Constitutional Court indicated that the Executive Project is incompatible with Article 148 of the Constitution and that it conflicts with the principle of non-regression and the right to health. Furthermore, it clearly contradicted the protection of the right to health and the principle of sustainability of social security, for which the organization referred to articles 11, 28 and 29 of the legal regulation.

“One of the most important aspects of this rejected reform was her attempt to cut all budgets, as well as her proposal to cancel interest payments on the Government’s debt to IESS. In addition, this decree intended to cut all budgets such as education, health (catastrophic diseases), etc., says the Cedocuta press release.

In Article 39 of the Regulation, it is stated that the following text be included as the thirty-fifth transitional provision: “Interest generated by contributions retained by the State until liquidation for the payment of contributions of 40% of pensions since the promulgation of the Constitution of the Republic, with the Ecuadorian Social Security Institute which, from the date of issue of this decree, the law is awaiting payment, it will be redeemed in full.

Pensioners from IESS held a protest in Guayaquil to cancel the interest on the debt that the state holds with the social security

In the meantime, in Article 28, the president requested to add: “The governing body of public finances must include in the proforma of the general state budget the mandatory state contribution for health benefits to the IESS as established by the Social Security Law.” For recognition and award, IESS must present the results of external audits aligned with the guidelines issued by the competent public health institution.”

In view of this, the CC pointed out that the removal of claims from IESS without any technical justification directly undermines its viability, contrary to Article 368 of the Constitution, which stipulates: “The social security system shall include public entities, regulations, policies, resources, services and social fees, and will act on the basis of sustainability criteria”, for which Article 39 of the project is “obviously unconstitutional”.