President Luis Lacalle Pou referred once again to the issue of social security in Uruguay and, particularly, to plebiscite against the reform carried out by the PIT-CNT, together with social organizations and sectors of the Broad Front. According to the president, “it is a high political risk move” to call the electoral body to define the future of the retirement system in the country.
Criticism of the plebiscite against the social security reform, promoted by the PIT-CNT, They are not new and they no longer distinguish political colors, regardless of their position on the Law 20,130. And recently, the president Lacalle Pou has also joined them.
“The political arena is not my responsibility, but we must provide certainty, because the future of retirements is at stake. “What is going to be done with the retirement of Uruguayans,” he expressed on March 2 during his annual speech to the General Assembly.
This morning, within the framework of his appearance in Breakfasts Search, The president mentioned the issue again, and indicated that he does not believe that the plebiscite “has a positive electoral effect for the promoters,” and instead “it has a negative effect for national protection.” In that sense, he assured that the initiative of the union center, supported by both the Communist Party and the Socialist Party that make up the Wide Front —and signed by both Carolina Cosse as for Andres Lima, both pre-candidates of the left coalition—”it is a move of extremely high political risk.”
“What’s going to happen to the AFAP? What is going to happen to the people’s money in the AFAP? What is going to happen to the retirement age? What is going to happen to the 1,400 retirees who are working today thanks to the fact that they can retire and work? Are we going to repeal the law? “Is there no more law?” asked the president before an audience that included, among others, the former presidents Jose Mujica and Julio María Sanguinetti.
Taking advantage of the presence of the former Broad Front president, Lacalle Pou He also recalled that, although the reform was approved with the votes of the government coalition, “everyone”—in reference to the ruling party and the opposition—agreed that “an urgent social security reform”. Even “President Mujica was sharp, contrary to what his party had been saying, saying that the retirement age had to be raised,” he noted.
“The political cost is paid by the one who generates uncertainty and not the one that generates certainties, in this case the one that carried out the social security reform,” he concluded on the subject.
The 10 risks behind the plebiscite
The eventual approval of the plebiscite against the social security reform promoted by the PIT-CNT —for which it continues to gather the necessary signatures— would bring “at least ten negative consequences” for the Uruguayan economy, according to the executive director of the Center for Studies for Economic and Social Reality (Ceres), Ignacio Munyo.
The economist questioned through his Kirchnerism”, which in 2008 advanced with a similar model.
He even described the initiative as “so populist as retrograde” and questioned that it adds “emotional arguments of immediate interest, which clash with the day after.” For this reason, she asked to “avoid the populist temptation” of signing the ballot.
Among the first negative consequences of the constitutional reform in terms of social security pursued by the union center, he pointed to the increase in spending due to greater passivities and the need for an extra 1.1 billion dollars per year to equalize retirements and pensions to the national minimum wage—equivalent to 1.5% of GDP—; as well as lowering the retirement age to 60 years, which would mean an increase of another 3 billion dollars.
Munyo also referred to the potential lawsuits against the State for the confiscation of savings managed by the AFAP; to the eventual tax increase to solve the extra costs – which would bring “serious damage to private investment and the future growth of the economy” – and to the consequent loss of the investment grade along with the legal security that characterizes the country.
The director of Ceres also pointed out that the approval of the plebiscite would generate a reduction in private savings, due to the ban. Something that, in parallel, would represent regressive effects on the income distribution. The PIT-CNT proposal also reintroduces “inequities” To the system.
Source: Ambito
