Pension is a key financial and human issue in life. I am part of the commission that proposed the reform, in the best of good faith and without hidden interest. reflections.

IESS, victim and disaster

1. It is a topic that should be discussed in society. If this proposal is not accepted, some may have to be approved in a few years. Obviously, there are many reform options, but they all involve accepting advantages and disadvantages. It is unacceptable to think: “better to know bad than to know good”.

2. The system has 5 years of life, then each pensioner’s pension will have to be reduced by 5-10% every year. Reason? First, demographics, previously a retiree contributed for 30-35 years and received benefits for 10-15 years, now they receive benefits for 20-25 years. Second, the Ecuadorian system is too generous, receiving between 50% and 100% of the average salary in the best 5 years is unrealistic. People don’t have comfortable pensions, but in a low-income society you can’t pay “that much”.

To save IESS

3. A reasonable pension meets 3 conditions. First, it is financially viable: it can be achieved without mirages. Second, receive a lifetime annuity: a certain amount each year, regardless of whether you live for a few years or a long time in retirement. Three, so that they can accumulate some “savings” as a supplement. It raises the reform.

4. It is not proposed to increase the contribution (11%), but the payment is proposed: 14 instead of 12 months.

5. There are no changes for current pensioners, they will continue under the current system. And those who are on the way will enter gradually: for example, who is halfway, will receive 50% of the pension from the current system, 50% from the new one. The move will last 30 years.

Money from ITT to IESS

6. The conditions for retirement are changing. For example, currently there is an option of 60 years of age and 30 contributions, this will change to 60/35. Likewise, 70/10 will become 70/15. But instead 64/30 goes to 60/27. Reason? have a more reasonable relationship between benefits and contributions. The change will be gradual over 10 years.

7. Amendment: the pension will be calculated on the basis

40% to 60% of the salary for the last 30 years aligned with inflation (instead of the current 5 years, and it will slowly move from one to the other). Pensions will be the same for people with the lowest incomes, and similar for others, but with the possibility of savings.

8. Those who work few hours will be able to join (not today) and if they do not meet the conditions necessary for a pension, they will be able to withdraw their inflation-adjusted contributions or donate a couple.

9. The government will allocate only up to 3% of GDP for free funds to take care of other collective needs, including poor pensioners outside the IESS.

10. The unemployment fund (2%) will be a pension fund.

11. Half of the reserve fund will again be savings, as it was until 10 years ago.

12. The employer’s pension for the new will consist of a pension fund for retirement and will be fed by the contributions of the companies in which they work.

13. Corruption. You have to fight hard, for which it is crucial to have a professional and upright board. Responsibility of those who elect their representatives.

Is it reasonable? (OR)