Government recognizes that pending debt of pensions to the IESS is in $ 1,371 million

The Ministry of Economy and Finance acknowledged that at the moment $ 1,371 million are pending payment to the IESS for 40% of the pensions. According to this state portfolio, the current government inherited payment obligations with the IESS and has gradually honored them. Proof of this is that this year has paid a total of $ 1,331 million. Of these, $ 967.5 million were canceled in the current Government.

The Ministry also explained that of the total amount paid ($ 1,331 million), $ 1,111 million correspond to the contribution of 40% of retirement pensions. However, the aforementioned pending still remains.

The statements of Finance are known later this week The president of the IESS, Francisco Cepeda, pointed out that the Government and the IESS should sit down and talk about the forms of payment of a large debt that exists from the State to the IESS and that has accumulated for several years. The debt is $ 8,175 million and includes, among the strongest items, debt for the legal payment of 40% of pensions, payment obligations for the Rural Social Security and the health debt that reaches $ 4,300 million.

The health debt arises because the Government is obliged to pay the medical attention of retirees and patients with catastrophic illnesses who are treated at the IESS. However, it was never charged, nor was it ever paid.

The president of the IESS has raised the alarm, indicating that under current conditions, the IESS pension fund could last until 2024. However, the health fund situation is more precarious and requires an immediate solution, since there are only $ 76 million in that fund.

For several years, governments have said that a methodology is needed to establish payments. There is a lack of documents that guarantee the payments.

In relationship with health debt, the Ministry said he is working a Inter-institutional commission between the IESS and the MEF to establish methodologies that allow determining the amount of this debt. “At the moment, the MEF is waiting for the IESS to deliver information on external audits, information bases and an agreed matrix ”, he said.

The MEF ratifies its commitment to comply with these obligations “as long as it complies with current legal regulations and with all the requirements that have been carried out, mainly, the medical audits established in article 125 of the Social Security Law”, it says the entity.

According to Jaime Carrera, executive secretary of the Fiscal Policy Observatory, the issue of Social Security and State debt must go through two key issues: the first is that there is sustainability in the public accounts, so that the Government can pay the IESS in cash and not in bonds. Fiscal sustainability It will also allow the State to pay the bond interest normally. This item reaches at least $ 500 million annually, he says.

The second aspect is that they must be carried out structural reforms to the Insurance so that it has more income. For Carrera, this means increase personal employer contributions, the retirement age could also be increased or the formula for calculating the pension could be changed which now takes into account the five best years of wages, and could be extended to the ten best years.

In third place, The lack of transparency in the figures is an issue that corresponds to the IESS to fix immediately. Carrera explained that there is no public information that gives light to society about the true situation of the IESS. Carrera assured that the lack of transparency was part of the reasons why the government did not conclude the review with the IMF in November. He explained that there were inconsistencies, for example, in the IESS salary category, While it was argued that $ 60 million was paid, the actual figure is $ 900 million.

Another longer-term issue is that governments seek to make the economy grow so that there are more workers who contribute to Social Security.

Given the urgency of the need for liquidity on the part of the IESS, for Carrera, the Government must apply a rigorous program to reduce expenses, and considering that the tax reform gave it higher income, it could pay the IESS at least 40% of the pensions. (I)