Congressman Jaime Quito Sarmiento presented Bill No. 7103, which seeks to gradually increase the minimum pension in the National Pension System (ONP) until it reaches the equivalent of a minimum vital remuneration (RMV).
This proposal arises to enforce the decision of the Constitutional Court of 2019 (sentence 0009-2015-PI/TC). This ruling ordered both the Congress of the Republic and the Executive Branch to progressively increase, over a period of three years, the minimum pension, in order to ensure that retirees have their essential needs covered.
How much would the increase in the minimum pension be?
The current minimum pension is S/500 and the increase proposed by the legislator is a maximum of S/1,205. This amount must be increased progressively over a maximum period of 3 years.
“Congress and the Executive have disregarded the TC ruling on the increase in pensions for 5 years, which is why, with project 7103, we propose a compliance route; We have calculated that, with an approximate contribution rate of 5% of the remuneration by employers, the equalization of the minimum pension with the minimum remuneration can be financed. And this should be the general rule,” said Quito Sarmiento.
Furthermore, he indicated that this increase to 1,205 soles could be much lower if the Executive Branch keeps its word to partially increase the minimum pension for the year 2024 and equate it with the RMV, which is currently S/1,025.
According to the proposal, the introduction of these changes will be carried out gradually. This means that private companies will increase their contributions little by little to avoid fiscal imbalances, especially when it comes to public sector workers. In addition, microbusinesses would receive special treatment, since they would only have to pay 50% of the standard rate.
On the other hand, this law also suggests the creation of an additional contribution by the employer, called Complementary Pension Contribution. This is done with the aim of reinforcing the financial stability of the ONP and ensuring that the minimum pension remains balanced.
Regarding the viability of creating this contribution, parliamentarian Jaime Quito highlighted that, according to ILO Convention 102, the financing of pensions should not depend solely on workers’ contributions (currently set at 13% of their salaries). in the ONP).
Likewise, he emphasized that Decree Law 19990 originally included employer contributions, but these were eliminated during the privatization reform of the 90s.
When was the last debate on the increase in the minimum pension?
Although the Economic Commission of the Congress of the Republic was scheduled to debate the report proposed by the Law of Modernization of the Peruvian Pension System on December 6, the session was finally postponed.
In that, the increase in the amount of pensions to S/600 for retirees from the Pension Normalization Office (ONP) would be discussed, as well as the withdrawal of up to S/9,900 (2 UIT) from the AFPs for those who did not contribute. for 6 months.
In accordance with the prediction that was going to be debated, the increase in the amount of pensions to S/600 would occur as of January 2025. This initiative is far from what was proposed by the Ministry of Economy and Finance (MEF), which proposed that The increase will occur from the beginning of next year.
Source: Larepublica
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