Supervisor of Financial Advantages of the IPS emphasised the necessity for reforms to enhance effectivity and sustainability

Asunción, IP Company.- In an interview with Radio Nacional 920 AM, Vanessa Cubas, financial advantages supervisor of the Social Safety Institute (IPS), defined this Friday the difficulties confronted by the establishment and the measures which might be being carried out to guard the pursuits of greater than 1,500,000 insured.

The official emphasised the necessity for reforms within the IPS constitution, evidenced by actuarial research carried out since 2000. “These research point out what reforms should be carried out to keep up the actuarial horizon and make sure the long-term sustainability of the establishment.” .

Cubas stated that they’re managing the establishment with nice accountability and adherence to the regulation. “All the pieces we suggest is in search of to progressively get well the monetary steadiness of our three funds and in addition shield the financial savings of hundreds of Paraguayans and retirees, due to whose contributions greater than USD 2.4 billion have been amassed in the present day,” he stated.

One of many most important issues is the deficit within the IPS funds, particularly within the Illness and Maternity Fund and the Retirement and Pension Fund. “At present, what is available in because the Employer Staff Contribution is just not sufficient to pay retirements and pensions,” Cubas defined, stating that the deficit in 2023 amounted to G. 370,000 million, coated partially by the earnings from the reserve fund.

Administration of three most important funds

The IPS manages three most important funds: the Administration Fund, the Illness and Maternity Fund, and the Retirement and Pension Fund. The primary two are annual spending accounts, whereas the third is a financial savings fund. At the moment, the reserve fund has greater than USD 2.4 billion, amassed by the excess between earnings and bills.

Lately, the IPS Board of Administrators revoked resolutions from 2020 and 2021 that had raised the minimal retirement wage above that established by regulation, returning to the ground of 33% of the minimal wage in power since 2011. This measure will have an effect on new retirees, whereas the present ones will keep their acquired advantages.

Cubas emphasised the necessity for your complete workforce to be shielded from the primary day of labor, stressing that it’s a authorized obligation of the employer and a constitutional proper of the employee. He additionally talked about that the modification proposals have been mentioned with the President of the Republic, who has given them his assist, and it’s anticipated that these will ultimately be introduced to Congress.

“These reforms, though unpopular, are seen as obligatory to guard the IPS reserve and make sure the monetary sustainability of the establishment. A broad participation of all sectors concerned shall be sought to debate long-term proposals, however pressing measures are important to get well the monetary steadiness of the IPS and assure its future,” he indicated.

On the identical time, he emphasised the necessity to take pressing measures to curb spending progress and shield amassed financial savings, whereas underscoring the significance of truthful communication based mostly on official sources to grasp the complicated scenario of the IPS.

“The overall contribution is 25.5%, of which 9% is contributed by the employee and 16% by the employer. Nonetheless, of that 25.5%, solely 23% stays within the IPS, because the extra 2.5% of the employer contribution is transferred to the Ministry of Labor and the Ministry of Well being to finance particular applications,” Cubas defined. “One of many modification proposals is that this extra 2.5% stay within the IPS to particularly reinforce the Illness and Maternity Fund, which might signify near USD 50 million per yr.”

500 properties awarded in cost of money owed

Cubas additionally talked about that the IPS owns practically 500 properties awarded in cost of money owed for worker-employer contributions that haven’t but been formally transferred because of the excessive switch prices. He proposed together with the IPS within the listing of establishments benefited by the regulation that permits the Authorities Notary Workplace to make these transfers with out extra prices.

One other proposed change is the replace of the reference interval for calculating retirements, going from three years to 10 up to date years, which might be certain that the salaries contributed are dropped at current worth and calculated pretty. “It will profit those that have contributed appropriately throughout their working life, however will have an effect on those that have solely contributed properly in recent times,” Cuba clarified.

The IPS additionally seeks the opportunity of offering well being providers to the uninsured in a non-emergent method, so long as the present insured usually are not harmed. This measure was authorised by the Council on April 25 and is within the technique of implementation.

The IPS financial advantages supervisor concluded that none of those proposals includes modifying the retirement age or rising the years or percentages of contributions. The reforms are aimed toward bettering the effectivity and sustainability of the IPS, defending sources and guaranteeing long-term advantages for policyholders.