The committee in charge of presenting a proposal to solve the very serious problem of Ecuadorian social security, especially that of the IVM, the Fund for Old Age and Mortal Disability, has completed its work and presented Ecuadorian society with a proposal that paves the way to save this vital tool for social justice and equality.

The IESS (Ecuadorian Social Security Institute) has health services for affiliates and their families and has a sector or department in charge of pensions for retirees and those who have been dismissed.

‘Ecuador is aging much faster’ and this would be a difficulty for the IESS pension system

IVM is actuarially bankrupt. Your finances are unsustainable. Even if the state were to pay everything it owes (which is impossible, because there are no funds for that), and even if the state were to allocate 40% of the value of pensions in the future (which is also fiscally unfeasible), IVM would still have a deficit in its basic operations, which would not be enough to pay pensioners.

There are many reasons for this. First of all, the absurd legal provision that obliges the state to pay that 40%, and the state has no funds. Second, the permanent fiscal crisis, which was caused by the maintenance of regressive subsidies and a low fiscal burden, which means that states used IESS funds to place bonds. At the same time, since in Ecuador interest rates are controlled and unrealistic, and since government bonds are not traded transparently, but are forcibly placed in government agencies, these papers have no market, and therefore the fiscal problem has turned into bonds. which IESS was forced to acquire, it finally becomes a crisis that cannot make these papers liquid.

Are the proposals for improving the state of IESS correct? Several of our columnists say so

Thirdly, demagoguery and populism which over time gave birth to a series of absurd benefits, 100% of the last salary, such as paying over 12 salaries to later receive 14 monthly incomes as a pensioner, such as allowing a member to retire with the average of the best 5 years contribution, which is totally illogical. The low retirement age in certain cases is also a problem.

The Ecuadorian community is being tested: if we do not reach a serious dialogue, we will show that we prefer to die…

Finally, the new demographic reality, which is ruthless in making the contributor/retiree relationship very critical.

The study carried out by the commission aims to solve the problems in the most painless way possible, respecting the acquired rights of pensioners.

Voices have already been heard that, without reading or studying the document, they opposed him “by definition”, by “DNA”. These positions are absurd. The state must study this proposal and understand that if the issue of social security is not resolved, it could drag the entire society into a crisis of unfathomable proportions, with simply unpredictable economic, political and social implications.

The Ecuadorian community is on trial: if we do not come to a serious dialogue, we will show that we would rather die than survive and that therefore we have something in our country that makes us absolutely irrational and that would be impossible to explain. (OR)