Reform would transfer S/1,830 million in favor of the AFPs

The consumption pension established in the pension reform promoted by the Congress of the Republic could transfer around S/1,830 millions of previously public resources towards AFPdespite the fact that the regulations themselves establish an opening of the pension market towards banks, municipal savings banks and other companies in the financial system.

The ‘Modernization Law of the Peruvian Pension System’ approved in the second instance for 34 million Peruvians with only 38 votes – 19 of them from Fujimorism – includes a pension for consumption that allocates 1% of the value of affiliates’ purchases to an individual account managed by an AFP or similar, but in no case on the public side, today in the hands of the ONP.

A report aired during the debate on the pension reform in the Economy Commission, and to which La República had access, indicates that, based on the information on the active RUC with the distribution of households and knowing what each person contributes, of 1% for consumption per year, we find that private administrators are going to have almost S/1,800 million available per year, in addition to S/30 million for commission.

According to official data from Sunat, there are 9.6 million independent workers as Active Registered Taxpayers. Only 1% of them (96,000) belong to socioeconomic level (SES) A, and if we multiply them by the S/412 that each individual in this stratum would contribute annually to their fund according to their average spending level, we have that private administrators of the system would begin to manage S/39 million 552,000 derived from their purchases each year, according to the report. The S/1,836 million are completed with the amounts derived from NSE B (S/356 million), NSE C (S/696 million), NSE D (S/409 million) and NSE E (S/336 million).

inclined scale

The problem, according to economist Eduardo Recoba, is that none of the new actors in the pension market, with the exception of the AFPs themselves, are in a position to immediately assume the funds, and there is also no clarity on the regulations that allow them to do so.

“The only ones who benefited from the maneuver are four AFP, three of them tied to benches. We will have to wait for what SBS says to know the operation and deadlines for new companies, without experience,” says the main economist of iFOREX Latin America.

Elmer Cuba, an economist at Macroconsult, points out that the new reform, thus proposed, still needs to be perfected. Although he recognizes that it is a first step, he also considers that it will not be an easily accessible market, because it requires a minimum of critical mass to achieve profitability.

Thus, Cuba warns that “they will not be able to access with current equipment.” If a bank or savings bank decides to open a pension unit, it will have to open individual accounts separated from the company’s capital.

“In theory, it is better with more actors, due to competition, but we would have to see if, empirically, it works like that. Today the market has four AFPs and, if it were so desirable, we would have five or six,” Cuba graphs.

Defects in the approval of the reform

There is no clarity on whether the reform is legitimate. According to a group of congressmen From the left and right, the norm is flawed because they did not respect the parliamentary procedures for its approval.

Congressman Carlos Anderson revealed that the president of Congress, Alejandro Soto, refused to sign the autograph due to the deletions. Sigrid Bazán said that they forged “ghost votes” in a victory with legislators out of their seats.

Reaction

Carlos Anderson, non-group congressman

“From my point of view, it is not a reform, it is pure makeup. It is totally biased towards the AFP and does not include 70% of Peruvians in the informal sector.”