Saturday, June 3, 2023

Will Colombia end the multimillion-dollar pension? Finance Minister Ricardo Bonilla said the highest pension in Colpensiones would be $2 million

This Tuesday, May 16, around noon, Finance Minister Ricardo Bonilla mentioned the effects of the pension reform in Colombia in a debate on political control in Congress.

In this session, they also discussed higher pensions in the Colombian region and their final end with the bill filed in the Legislature.

High pensions, because of the subsidized financial cost they represent, represent one of the biggest gaps that think tanks and experts have noted urgently need to be fixed, according to Valora analytic portal. Based on this, the pension reform, according to the government of President Gustavo Petro, moves in this direction, based on a system with greater and fairer coverage.

The foregoing represents a significant change to the pensions that are paid out in Colpensiones and the subsequent deficit that the country will have is one of the cornerstones in the exchequer.

Pension Reforms: Now how is pension in co-pension?

Minister Bonilla indicated that the three minimum wage limits of the pension reform in Colombia reduce and limit subsidies for higher pensions through public funds.

Minister Bonilla said, “After it is approved, no one will be able to retire in the public system with 20 or 25 minimum wages.”

In the Valora Analytic report, it is read that the Colombian Finance Minister stated that the maximum pension in Colpension will be of the order of three minimum wages, which, with the replacement rate, means that the allowance is 1.8 minimum wages.

In practice, this would be the highest pension for those who receive up to three salaries, about $2 million.

In the eyes of a recent Finance Ministry report, the long-term deficit in pension matters would be of the order of 67.5% of GDP, but reform would bring it down to 55.2%.

“The savings fund prevents the deterioration of national savings, and in particular allows the dynamism of the public debt market to be maintained,” the entity said.

He said: “It is a key objective of the country’s macroeconomic policy. Thanks to its operation, at 2023 prices, the Fund will have accumulated resources of $124 billion by 2030.

“There is financial stability, we are not overruled and the pension system is funded”: Labor Minister

A week earlier, in the midst of a public hearing on pension reform, “Cambio por la Vez”, which was attended by private pension funds, unions, social organizations, pensioners’ associations, trade unions and the national government, Labor Minister Gloria Ines Ramirez, introduced the bill. Were clear in explaining financial stability.

“What we have done is model with the finance ministry and we can say that till the year 2052 that our modeling runs, there is fiscal stability, we are not over rule, the system is clearly financed, 3 minimum wages, from Lowering 3 minimum wages is not going to be worth it because we will not strengthen the public system, which is one of the great aims of this pension system,” said the head of the Labor portfolio.

The senior official also highlighted the benefits of the pillar system on which the pension reform project is based, including the solidarity pillar, which would allow adults over the age of 65 to be provided with an income of $223,000 and this value by country. will improve. financial system.

“This project will guarantee the universalization of the right to a decent pension and for those who will not reach the pension, an income guarantee that will guarantee respect in their old age and we will replace the 2 regimes that are in competition and that do not do their work. A public system that today has 6 million associates and about 1,700,000 pensioners and a private system that has 18 million associates and only 294,000 pensioners means that governance does not serve its purpose, which that it is being retired”, insisted the Minister of Labour.

Nation World News Desk
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