He Executive power will seek to implement an increase in the contribution rate to the Retirement and Pension Fund for University Professionals (Cjppu) of Uruguay after the project to reform the social security institute failed in Parliament, so the Minister of Labor and Social Security, Pablo Mieres, He assured that this decision will allow the discussion to extend until the next government.
The minister referred to the project and the reasons for its failure, based on the lack of dialogue that ended with the refusal of Town meeting and the Wide Front. “It seems important to us to seek a consensus to approve an article that incorporates resources from the fund so that this viability is extended for at least one more year, that is, until 2026,” stated Mieres.
A task for the next government
With the increase in contributions, the Minister of Labor assured that “the reserves are increasing in such a way that they allow the fund sufficient time for the next government Vote for the reform, not for the bullfights.”
In that sense, he explained that the project has only one intention, which is to increase from 16.5% to 18% starting in 2024 and 19% starting in 2025. With this, extra income would be generated for the fund. starting next year.
Regarding the possibility of disaffiliates due to the increase in contributions, Mieres He assured that it is a risk that has already been calculated. “The measure was part of the general project. There is a sensitivity analysis and there may be some disaffiliation, but the signal is quite the opposite, that is: the box is going to have prospects. “It is not at risk because the reform has not been approved and there will be time to vote on the substantive law,” he explained.
Regarding the possibility of it being approved in the Parliament, Mieres said that, in principle, they have the votes for the vote to take place today in the Senate and hope that tomorrow it can be done in Deputies. “For now we are clear that there are votes from the coalition,” he said and assured that part of the government transmitted the idea to the Broad Front, although they are still not sure if they will receive the support of the opposition.
What does the Executive propose?
The initiative on which the Executive Branch is working and that would be sent in the next few hours to the Senate is a replacement for the article 58 of Law 17,738 of January 7, 2004, on the structure of the Professionals Fund.
This article is about the contribution rate, the key point that the government sees to try to buy time for the Cjppu and where the modification is proposed. Currently, the rate among active members is 16.5% of the fictitious salary of the corresponding category in each case, plus the percentage taxes that, by legal provision, the Fund receives.
What the Executive proposes is to raise this contribution rate to the 18% starting January 1, 2024; and to 19% from January 1, 2025. In this way, the amount of income would increase, which would allow the situation of deficit that crosses the Professionals Fund. Although this would be nothing more than a temporary solution.