April 2, 2020 | 16:29GMT
On the legislative initiatives to allow the extraordinary withdrawal of pension funds in the Private Pension System
The Capital Market Advisory Council, a forum with the participation of public and private sector institutions whose objective is to promote dialogue among its participants and propose measures for the development of the Peruvian capital market1/, considers that the comprehensive evaluation of pension systems public and private in Peru must be carried out with technical criteria and seeking the participation of all public and private agents involved, without failing to recognize the importance and urgency of implementing economic initiatives that allow us to face the current situation.
We therefore consider the recent measures implemented by the Executive Branch to be prudent to mitigate in the short term the economic effect of mandatory social isolation as a result of Covid-19 on the income of contributors to the Private Pension System-SPP (temporary suspension of the mandatory contribution and the extraordinary withdrawal of S/ 2,000 to contributors who have not contributed to the SPP in the last six months), and we consider that any new initiative promoted by the different powers of the State must be done taking care of the integrity of the pension system and its impact on the market of Peruvian capital, as this is one of the fundamental pillars of its development.
On the other hand, we believe that the reform of the public and private pension systems must be carried out using the mechanisms that the powers of the State themselves have created; seeking to preserve workers’ pension savings in a context of unstable economic and financial conditions. In this regard, in April 2019, through Law No. 30939 (Law that establishes the Special Early Retirement Regime for the Unemployed in the Private Pension System), the formation of a council was established to evaluate the situation of the pension systems. that within a period of 180 days it had to present a comprehensive evaluation of the main conditions of the public and private pension systems. In said regulation it was stated that the Technical Secretariat of said council, in charge of the Ministry of Economy and Finance, would report its results to the Economy, Banking, Finance and Financial Intelligence and Labor and Social Security commissions of the Congress of the Republic.
For this reason, this Advisory Council recommends that the Executive Branch and the Legislative Branch use the mechanism proposed in the aforementioned Law to reformulate the public and private pension systems that allow non-hasty decisions to be made and thus contribute to Peruvian pension savings improving the retirement conditions for workers and support the economic growth of the country.
