Chile has been trying to reform its pension system for more than ten years, without success until now. But President Gabriel Boric has made it his priority. Debated for two years in Parliament, the left-wing government’s bill seeks to improve the current model inherited from the dictatorship and which is based on individual capitalization. Today, 72% of pensions are below the minimum wage.
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With our correspondent in Santiago, Naïla Derroisné
One of the major problems of pensions in Chileis that they are far below the remuneration that workers received during their working lives. Result: many retirees continue to work after the legal retirement age. Pensions are managed by private administrators. This system precarizes retirees and especially women.
The reform promised by the Chilean president is therefore eagerly awaited. Gabriel Boric wants in particular to limit the role of Pension Fund Administrators (AFP), private entities considered by many to be responsible for the precariousness of retirees.
“ The government lacked conviction »
Two years ago, when the government presented his reformthe idea was then that employers, who today do not contribute at all, would contribute 6% to pensions. And that this percentage goes to a solidarity fund to increase the amount of pensions.
But faced with the outcry from the right-wing opposition, this percentage was fragmented. Finally, part could be redirected to these famous AFPs. For Luis Mesina, spokesperson for an organization that wants to put an end to these private administrators, it would be “ the worst betrayal » from the government: “ The government lacked conviction and did not have the courage to confront the right “, he laments.
The organization considers that if the reform is approved as is, it would only consolidate the current model and the AFP, leaving Chilean retirees in the same precarious situation.