The President of the Board of Directors of the Ecuadorian Institute of Social Security (IESS), Eduardo Peña, reported that the institution is reviewing a membership program for young people between the ages of 15 and 24 who will be able to start contributing to their pension and have medical and dental, and that with team could recruit 60,000 to 70,000 members.

The idea is to expand the base of collaborators with a smaller contribution than the contribution of voluntary members. Therefore, the membership fee for this new product would be $50, while voluntary members pay $80 per month. The proposal was explained in a conversation with Democracy TV.

In addition, he indicated that young members will have health and dental insurance, and that they hope to attract between 60,000 and 70,000 new members in this category in the first year. He commented that one of the problems of social security, both in Ecuador and in the world, is that there are fewer and fewer active members covering retirees. In Ecuador, at least eight funds are required for a pensioner, but now there are five for each pensioner.

Although it is still not clear what the scope of this new program will be, certain doubts are already being created among experts on the subject of social security.

For Mauricio Espinel, from the Social Security Study Group, it is positive that they are trying to increase fundraising for social security financing. However, there are several factors to consider:

Espinel believes that the problem of financing the collection system is for everyone who receives it. These would be members’ children under 18, pensioners and people who have catastrophic illnesses. There is already an actuarial study for this which determines that if this cost is charged to all members, the contribution should increase by 1.6%. And if it were voluntary, those who agree to take care of children should have an increase of 2.4 percent. Childcare currently costs the IESS $380 million a year.

He explained that care for retirees must also be covered and could be through co-insurance. The Social Security Study Group raised this issue with the Ministry of Health. Talks have also progressed with former minister José Ruales.

In this sense, he commented that the solutions do not imply taking uneven measures, but rather structural reforms that solve the problems of the next 20 or 30 years. This is not only happening because of the payment of the national debt to IESS. If 10 billion dollars of that debt were paid, it would only be enough for a year and a half of pensions. Likewise, the delivery of Banco del Pacífico, which generates $100 million a year, is insignificant compared to the high pension and health benefits that must be covered.