Pension reform, which abolishes private and professional funds, The saw also passes through a widow’s pensionWith a time period for young couples and a general review of these benefits, achieving savings of 0.5% of GDP
The CIPPEC proposal before Economy Minister Luis Caputo details a series of comprehensive reforms to the economy. Old-age pensions, widows’ pensions, retirement ages, and exclusion systems And professional funds.
What does the saw say about widow’s pensions?
As for death pensions, the pension reform raises Temporary limitation of pensions for young couples Reviewing the assets of pensioners.
The changes focus on eligibility, duration and calculation of retirement benefits:
Comprehensive eligibility: The scheme requiring regular contributions of active workers has been replaced by a universal system.
Limited timeThe benefit period for young couples will not be for life. It will have a time limit linked to the age of the survivor (for example, two years for those under 30).
Benefits for retirees and retirees: If the pensioner’s spouse is also a pension beneficiary, the proposed rule is that only the relative benefit of the deceased generates a pension, preserving the attainment of one primary benefit.
What is the criticism of the current pension system?
CIPPEC described Argentina’s pension system as expensive, unfair and inefficient. Argentina allocates approximately 10% of its GDP to finance retirement and similar benefits, a level similar to those found in much older countries.
The inefficiency is mainly due to three elements:
- the Exceptions multiplyThis allows approximately 2.8 million people to receive benefits before the minimum regulatory age (60 for women and 65 for men).
- Outdated rules Death pension systemResulting in duplicate benefits for more than a million people.
- The extreme generosity of some Exception charts Regarding retirement age and/or salary calculation, which affects the added cost.
The unfairness of the system is based on the existence of approximately 200 exception systems and a rule that requires 30 years of contributions to obtain the benefit of contributions.
This leads to People with similar career paths receive very different benefitsDepending on factors such as the county they live in, whether they work in the public or private sector, or whether their occupation is classified as “private.”
What is pension reform?
The proposed reforms seek to reorganize the system to do this Fairer, more equitable, more transparent and more predictable. With equal resources, the proposal distributes them better and improves the assets of the majority of future beneficiaries.
Major repairs The proposals focus on four areas of the public systemL: Initial asset structure, retirement age, disability benefits and death pensions.
The proposal also includes merging exclusion systems and enabling a voluntary pension savings system.
How will the initial balance be calculated?
The reform proposes a system of basic utility (PB) + relative utility (PP), Eliminate the 30-year contribution requirement So that access to the system is global.
Basic Benefit (PB): It is defined as the present value of the Universal Old Age Pension (PUAM). In March 2025, that amount was $223,297. It will serve as a new minimum value, eliminating the current minimum asset number.
Relative benefit (PP): It is calculated based on the full history of contributions made (including employees and self-employed) using actuarial calculation. This methodology replaces the current formula that uses updated average salaries for the past 10 years.
What will be the new retirement age?
The proposal includes two gradual changes regarding the minimum retirement age:
Gender equality
A Gradual increase in the minimum age The woman retreated From 60 to 65 years old, equivalent to the age of a man. This measure will be implemented by raising the age by 6 months annually over a period of 10 years. The current variation is not based on standards of health or ability to work.
Updated life expectancy
Establishes a Gradual updating of the minimum age for the entire populationincreasing by one month per year, accompanying the development of life expectancy.
Furthermore, the actuarial calculation of proportional benefit generates a A direct incentive to postpone working life beyond the minimum ageas the asset increases depending on the remaining life expectancy at the time of retirement.
What happens with retirement and disability pensions?
It is proposed to unify disability protection plans and absorb non-contributory disability pensions into the contributory system.
Rules for granting the subscription system (which requires Reviewed by a specialized medical committee Based on a scale) that will be adopted for all cases, in the pursuit of greater transparency and fairness.
Regarding the asset account, we seek tApplication of the old-age benefits model (PB plus PP), an estimate of the assets the beneficiary would have had if he had lived to retirement age.
The reform seeks to replace the fragmented model based on exceptions and “regulatory corrections” with a scheme of common rules, enhancing the legitimacy of the pension system.