They present a new project for AFP withdrawal of S/19,800: how many proposals are pending debate?

A new bill on AFP withdrawal entered the documentary process in Congress. This time, parliamentarian Flavio Cruz from Perú Libre presented a legislative initiative that seeks to authorize members of the Pension Fund Administrators (AFP) to request the disbursement of up to 4 UIT, which is equivalent to S/19,800.

In this way, the regulatory proposal joins six others that also propose releasing funds for the same amount and more than twelve bills that are pending debate in the Economy, Banking, Finance and Financial Intelligence Commission. Then find out all the details in the following note from La República.

New AFP retirement project of 4 UITs: what is it about?

According to the explanatory memorandum of Bill No. 6230 by Congressman Flavio Cruz, the objective of this regulatory proposal is to authorize a withdrawal of up to 4 tax units (UIT) of the total funds in the Individual Capitalization Accounts (CIC). . This will allow the family economy to be relieved in the face of the slowdown, the impact of COVID-19, the effects of Cyclone Yaku and the announced occurrence of the El Niño phenomenon.

“In 2023, the problem will deepen due to the serious economic crisis, which prevents a large sector of the Peruvian population from being able to satisfy their basic needs. In addition to this, the slowdown in GDP growth has real and concrete consequences in the life of the Peruvian population and combined with other macroeconomic aspects, today it becomes more difficult, this situation is not alien to the thousands of contributors to the Private Pension System,” reads the initiative of the Peru Libre parliamentarian.

How would the AFP withdrawal of 4 UITs be carried out, according to the new project?

The legislative initiative by parliamentarian Flavio Cruz empowers members of the Private Pension System (SPP) to withdraw up to S/19,800 from their pension funds. Additionally, it establishes the following procedure:

• AFP members must submit a withdrawal request virtually or in person within 60 calendar days after the law regulations come into effect.
• The payment will be up to 2 UIT, which is equivalent to S/9,900 every 30 calendar days. The first disbursement will be made 30 days after the request is submitted to the member’s Pension Fund Administrator.
• If the member decides to cancel the withdrawal request, he or she may withdraw up to 10 days before disbursement.
• In the final complementary provision of the proposed law, it is established that the Superintendency of Banking, Insurance and Private Pension Fund Administrators will determine the operating procedure for compliance with this law, within a period that should not exceed fifteen calendar days after of published.

AFP Withdrawal: how many bills are pending debate?

After the presentation of the bill by Congressman Flavio Cruz, there are now 17 legislative initiatives that seek to authorize a seventh withdrawal of funds from the AFP. Of the total, seven of these proposals propose releasing up to 4 UIT from the Individual Capitalization Accounts; three of them intend to increase the amount of the disbursement to acquire a property or pay debts through the mortgage guarantee; and, finally, the majority provides that citizens use their pension savings to face the rise in prices of products in the basic family basket.

To date, only four bills related to the release of AFP funds have been debated: withdrawal of up to 2 UIT (Segundo Montalvo), release of up to 3 UIT (Víctor Cutipa) and two AFP withdrawal initiatives of up to 4 ITU, whose authors correspond to parliamentarians José Luna and Guido Bellido. Here we present a list of all the regulatory proposals that are pending debate in the Congressional Economy Commission:

1. AFP withdrawal from 2 UIT (S/19,800) – Segundo Montalvo Cubas (Free Peru)
2. AFP withdrawal of up to 4 UIT (S/19,800) – Digna Calle (Vamos Perú)
3. AFP withdrawal of up to 3 UIT (S/14,850) – Víctor Cutipa (Peru Bicentennial)
4. AFP withdrawal of 50% of funds – Elías Ávalos (Vamos Perú)
5. AFP withdrawal of 70% of funds – Américo Gonza (Perú Libre)
6. AFP withdrawal of 50% of funds for home purchase – Patricia Juárez (Fuerza Popular)
7. AFP withdrawal from 3 UIT (S/14,850) – Víctor Flores (Fuerza Popular)
8. AFP Withdrawal from 5 UIT (S/24,750) – Jaime Quito
9. AFP Retirement from 4 UIT (S/19,800) – Guido Bellido (Peru Bicentennial)
10. AFP withdrawal of 25% to pay debts with mortgage guarantee – Melissa Córdova (Avanza País)
11. AFP withdrawal of 100% for home purchase – Ilich López (Popular Action)
12. AFP Retirement from 4 UIT (S/19,800) – José Luna (Vamos Perú)
13. AFP withdrawal from 4 UIT (S/19,800) – Jorge Luis Flores Ancachi (Popular Action)
14. AFP withdrawal from 4 UIT (S/19,800) – Kelly Portalatino (Perú Libre)
15. AFP withdrawal from 4 UIT (S/19,800) – Luis Aragón (Popular Action)
16. AFP Withdrawal from 4 UIT (S/19,800) – Mariza Taipe (Perú Libre)
17. AFP withdrawal from 4 UIT (S/19,800) – Flavio Cruz (Perú Libre).

AFP Retirement 2023: when will the next debate be?

So far, the Economy Commission, chaired by parliamentarian César Revilla, has met five times. Likewise, its members have been able to listen to presentations on the withdrawal of the pension fund and the reform of the pension system by the Minister of Economy, Alex Contreras, the superintendent of Banking, Insurance and AFP (SBS), María del Socorro Heysen Zegarra, and Giovanna Prialé, president of the Pension Funds Association.

Likewise, four congressmen have presented the scope of their bills that seek to authorize a seventh release of the money accumulated by members in their pension funds and there are still around 13 more legislative initiatives pending to be addressed, until reaching the drafting of a opinion that enters the Plenary Session for subsequent debate and voting.

The next session of the Economy Commission should be held on Wednesday, November 1, but, as it is a national holiday for All Saints’ Day, it would be postponed to the following week.