AFP Retirement 2024: when does the new debate on the release of funds of up to S/20,600 begin?

The Economy Commission, chaired by Congressman César Revilla, scheduled for this week the debate and vote on the Modernization of the Peruvian Pension System, which includes a withdrawal of up to 4 UIT (S/20,600) from the Pension Fund Administrators ( AFP). As recalled, in the last session held on Wednesday, March 13 in Chanchamayo, the topic could not be addressed due to connectivity problems.

Now, parliamentarians will be able to attend in person at the headquarters of the Legislative Palace to address this proposed opinion on the reform of the pension system, which brings together more than 70 bills and seeks to facilitate the progressive access of citizens to a fair pension. , as well as guaranteeing progressivity in the application of the right to social security. Below, find out all the details of the new changes proposed by Congress for AFP and ONP members.

AFP withdrawal of up to S/20,600: what will be the new date of the debate?

After the postponement of the debate on the opinion of the Law of Modernization of the Peruvian Pension System, which was to be held in Chanchamayo during the fifth extraordinary decentralized session of the Commission on Economy, Banking, Finance and Financial Intelligence of Congress, a new date has been scheduled to address this proposal.

According to the summons sent to the parliamentarians of this working group, the discussion about the pension reform that incorporates a new withdrawal of up to 4 UIT (S/20,600) from the Individual Capitalization Accounts (CIC) is will take place this Monday, March 25 at 11 am in the Chamber of the Legislative Palace.

What is the new AFP withdrawal formula of up to 4 UIT about?

According to the thirteenth final complementary provision of the pension reform opinion, AFP members are extraordinary authorized to withdraw up to 4 UIT from their Individual Capitalization Accounts (CIC), as long as they prove that they have not received contributions during the last six consecutive months until November 30, 2023.

Likewise, it is specified that this condition applies until the withdrawal is equivalent to 95% of what was contributed by the affiliate, indicating that the remaining 5% will be transferred directly to EsSalud by the corresponding AFP. To this we must add that members who qualify for the Early Retirement Regime for Unemployment (REJA) will not be able to request the disbursement of funds.

Finally, the sixteenth complementary provision of the opinion establishes the release of up to 2 UIT (S/10,300) in a single withdrawal from the capitalization account of affiliates who suffer from an oncological disease diagnosed by an institution providing health services, which must have the appropriate health authorization.

What are the axes of the pension reform proposed by Congress?

The proposed opinion to reform the pension system brings together 71 bills from various congressmen and seeks to guarantee the pension protection of all citizens, whether or not they have an employment relationship. In this sense, it establishes a series of mechanisms to ensure the payment of a minimum pension to its members and proposes a single, universal, egalitarian pension scheme integrated into a multi-pillar structure. Below, learn about all its main scopes:

• Free transfer between AFP and ONP: The new pension reform law establishes that members of the National Pension System may transfer to the Private Pension System at any time, having the right to the recognition bonus for the contributions made.
• Mandatory membership from 18 years of age: People over 18 years of age who are not affiliated with the system will have to join the SNP or SPP. If they do not express their will, they will be integrated into the private sector.
• A minimum pension of S/600: The prediction establishes that for both the ONP and AFP, there will be a minimum pension of S/600 for retirements and cases of disability. In the case of the orphan’s and widow’s pension, it will be a minimum of S/400, as long as the contributor has contributed for 20 years. Likewise, the ONP’s maximum pension could be readjusted from S/800 to S/1,000 by the MEF.
• AFP withdrawal for mortgage credit: According to the prediction proposal, it is established that affiliates may withdraw up to 25% of the fund accumulated in their CIC for the payment of the initial payment or amortization of a mortgage loan for a first property.
• Consumption pension: It is a voluntary contribution for pension purposes from the consumption expenses made by members in their daily purchases. It corresponds to 1% of the sum of the value of the payment vouchers within each fiscal year, with a limit of 12 weekly UIT (S/61,800) per year.
• Contributions from independent workers: The pension reform proposal introduced that independent workers in the private sector must make mandatory contributions, which will be applied gradually to income from fourth and fifth category jobs. This will begin with 2% as of January 1 of the third year after the entry into force of the standard, which will increase by one percentage point every two years until reaching a maximum of 5%.