Teachers would not have differentiated pensions, but they would have a salary adjustment

The National Assembly, this March 13, began to discuss a project that closes any possibility of applying an early retirement to 18,665 affiliated teachers belonging to the national education system who could meet special retirement conditions, when processing in the second debate the reforms to the Organic Law of Intercultural Education (LOEI), ordered by the Constitutional Court.

What the legislature does analyze and hopes to find 70 votes, is to apply a new salary scale from category G, with a base salary of $986 to $2,034 for category A teachers.

The legislators met this Sunday to conclude the processing of this bill due to the expiration of the term granted by the Constitutional Court to ratify or replace the regulations approved by the previous Assembly on salary increases and apply a retirement special for teachers of the national education system.

The processing of this project was nuanced by a sit-in led by teachers grouped in the National Union of Educators in front of the Legislative Palace.

Regarding early retirement for the teaching profession, the commission accepted the recommendations made by the actuarial studies that the population should not be fragmented and the creation of differentiated benefits, without technical support. Therefore, teacher retirement must follow the conditions and requirements established for social security in general.

The remuneration scale that arises in the project that will be reported to the Executive begins in category G with $986 up to $2,034 in category A. Teachers with a contract and provisional appointment will earn $817 when they have their degree.

Currently, a teacher in category G receives a salary of $817 and with the adjustment he would earn $986, and a teacher in category A has an income of $1,676 and with the increase he would earn $2,034.

The legislative provision states that the Finance Minister will make the necessary adjustments, transfers and programming in the next three months.

The session entered a recess at 2:00 p.m., after an hour it is expected to resume for the vote on the text. The agenda includes the procedure in the first debate of the urgent economic investment project sent by the Executive.

Debate

The economic authorities of the Government warned that the reforms introduced to the LOEI, in the previous legislative period, contain the respective financing, since the current current income is insufficient to cover the new proposed obligation.

But Assemblyman Manuel Medina (PK) said that the Education table he chairs validated the opinions of economic experts Pablo Dávalos, Diego Borja and Assemblyman Mireya Pazmiño, who argued that the State will receive additional income from the increase in the price of barrel of oil, the increase in tax revenues and the reestablishment of the budget for education.

Legislator Nathalie Arias (BAN) questioned the sources of financing indicated by the legislative table, since permanent expenses cannot be financed with non-permanent income.

That it is absurd to talk about the use of resources from the increase in the price of a barrel of oil, when they are absolutely conjunctural and the item that will enter is less known.

The estimated fiscal impact of the new teachers’ salaries is $2.8 billion, and that is equivalent to double what the tax law, which a sector of Parliament wants to repeal, intends to collect. When those resources are destined to cover the deficit, and that the funds of the Central Bank are not petty cash either, since they correspond to the reserves.

Assemblywoman Isabel Enríquez, from PK, said that salary equalization for teachers is pertinent and that this does not imply $2.8 billion, as the government spokespersons claim, but rather that the figure does not exceed $700 million.

He questioned that today they are promoting dialogue tables, but when it was under discussion the government never showed interest.

Processing of the reform

The National Assembly, on March 9, 2021, approved a project that reformed the LOEI, and it was published in the Official Registry on April 19, where there were no observations from the Executive.

In May 2021, the Constitutional Court admitted the unconstitutionality action filed by the Ecuadorian Social Security Institute (IESS) and a private individual, and as a precautionary measure suspended the validity of the reforms.

The current legislature, in June 2021, supported the reforms published in April of that year and determined that it meets the legal and constitutional requirements, and requested the revocation of the precautionary measures.

The Constitutional Court, in August 2021, declared the constitutionality of the reforms to the LOEI, but challenged what was related to the special retirement regime for teachers of the national education system, and granted the Assembly a period of 30 days to correct the observations based on actuarial studies presented by the IESS, and from there it must be debated and approved in two debates.

The Vice Minister of Finance, Édgar Orellana, before the Education Commission, pointed out that there is no budget for the salary increase and that it must comply with its constitutional obligation of the tax increase equivalent to 0.5% of the gross domestic product (GDP), for the education sector. would imply that “the entities with the greatest participation, such as the Ministry of Public Health, the Ministry of Economic and Social Inclusion, the Ministry of National Defense, the National Police, would have to disappear in order to partially finance the application of the bill, putting the services at risk. that they provide to the general public”.

That assertion bothered the legislators and they consider that the ministry gave little importance to what was ordered by the Constitutional Court.

The information provided by Nelson García Tapia, general director of the IESS, regarding the actuarial report on the impact of the reforms to the LOEI, determines that as of December 2021 there are 18,665 affiliates belonging to the national education system who could meet special retirement conditions.

The actuarial cost to finance the reduction in contribution times, with the consideration that there is no lower age limit and assuming that all teachers who meet special retirement conditions in 2021 opt for it, the necessary reserve to finance this benefit reaches a value of $897,587,591.66.

The actuarial study considered a horizon of 40 years, for which the technical reserve accumulated from the year 2022 to the year 2060 that is required to be able to cover the early retirement of teachers is $16,514,867,101.87.

That the impact on health insurance due to the anticipation of retirement for teachers, for medical coverage of these retirees, would amount to a projected value of $ 23,051,275, for the first year of application of the Law. Emphasizing that it does For more than 20 years, the IESS has not received payment for the expenses incurred by these beneficiaries, a debt that as of December 2021 with interest as of November 2021 is $4,526,725,352.73, which increases to $5,123,834,794, 89.

As of the cut-off date of this study, the weighted average salary of teachers is $899.46; the weighted average remuneration of teachers in special retirement conditions is $1,045.12; the weighted average age of the female population is 42.9 years, while for the male population it is 43.9 years. (I)