Early this morning the Senate approved three bills aimed at implementing reforms in different areas of the state, reforms the Macri administration began pushing since its victory in October’s midterm elections: to the pensions system, to get provinces to reduce their spending and for all of them to have a cohesive fiscal structure.
The first bill was by far the one that caused the most controversy. If approved by the Lower House – taking for granted the President would then sign on the bill, considering his administration is pushing it – the initiative would reduce the extent to which pensions would increase from 2018 on. Even though they would still beat the inflation rate, they would do so for a lesser margin than with the existing system.
Moreover, the project would enable eligible pensioners to choose not to retire when they reach the age threshold – 65 for men, 60 for women – and continue working for five more years. During this period, their employers – should they have one – would stop paying the part of their salaries that goes to the state to pay for, among other things, their pensions and healthcare. The initiative would also grant that people who made these payments for the required 30 years and get the minimum pension would get 82 percent of the minimum salary at the time as pension.
The project was approved with 43 positive votes, 23 negative ones and three abstentions. Within the group of senators who voted in favor, however, were different arguments about the reasons to do it. PRO Senator and provisional president of the Senate, Federico Pinedo, for example, said “this will guarantee that Argentina will not explode in 20 or 25 years time.”
On the other hand, leader of the Justicialist Party (PJ) caucus Miguel Ángel Pichetto admitted the reform would harm pensioners, but argued he – and those from the party who vote along his lines – did it because they were supporting a decision previously made by the provincial governors.
Pichetto said “Everything has ties with everything, and no one was taken by surprise or had a gun to his or her head, they knew what they were signing.” He then remembered “we had a bad experience with [former President Fernando] De la Rúa and austerity measures that deepened a crisis,” and clarified this measure is a “decision that answers to juncture, for a reduced period of time.”
In contrast, those who voted against argued the project goes against the people’s interests, and especially a sector as vulnerable as pensioners. “Had we applied this system this year, they would have received 3.5 percent less [money than what they ended up getting],” Senator Guillermo Pereyra from Neuquén said.
When it comes to the other projects, they are the result of an agreement between the Macri administration and 22 out of the 23 provincial governors – San Luis’ didn’t sign it – and the City of Buenos Aires Mayor to reform their respective fiscal systems and drop the lawsuits they have against the federal government. In exchange, they will be compensated by the state.