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Categories: World News

Chilean President Allows Third Pension Withdrawal


SANTIAGO (AP) – President Sebastián Piñera promulgated a bill approved by Congress on Tuesday that will allow millions of Chileans to use 10% of their pension funds for the third time within hours of suffering a strong defeat at the hands of the Court. Constitutional Court (TC), which rejected his request to stop the legal initiative promoted by the center-left opposition.

Piñera decided to sign the project a few hours after knowing the ruling of the TC and in the midst of multiple voices of government and opposition that urged him to allow the transfer of retirement funds so that millions of Chileans better face the economic crisis unleashed by the pandemic .

Seven of the TC ministers voted not to process the request of the president who asked them to declare the project unconstitutional, and the remaining three were about to accept it. His statement did not refer to the project’s fund, which was approved last week with the support of dozens of votes from parliamentarians from the governing coalition.

“As a government we respect and accept the decision of the Constitutional Court without prejudice to not sharing it. For these reasons, we will enact today the reform approved by Congress to allow withdrawals of 10% of pension savings … we will make all our efforts so that these resources reach Chilean individuals and families as of next week, ”he said. in a short speech from the government palace.

Iván Moreira, senator of the conservative Independent Democratic Union (UDI), pointed out shortly before that “this is a very big defeat for the government”, in addition to urging the enactment of the opposition bill.

Yasna Provoste, the opposition president of the Senate, had told Piñera shortly before, at a press conference, that “we hope that he will promptly and swiftly promulgate the project for the third withdrawal.” In addition, he reiterated a call for “through dialogue” to generate public policies that “allow citizens to survive with dignity in these difficult times.”

Piñera went to the TC a week ago to declare the bill unconstitutional and last Sunday he presented his own initiative so that Chileans will draw the same 10% of their funds from the administrators that manage them. He dismissed the multiple pleas of pro-government parliamentarians not to go to the TC.

After the setback suffered, Piñera could also have vetoed the project or have presented an additive veto that adds some elements of his initiative.

Piñera, in addition to informing during the day of the enactment of the opposition initiative, withdrew from Congress of his project and anticipated that in the coming days he will present another initiative that grants a bonus of 200,000 pesos (about 280 dollars) to each of the three millions of people who have run out of funds after withdrawing money from their accounts on two previous occasions. This point is not included in the bill already approved by Congress.

Specialists estimate that another million people will run out of funds after drawing for the third time from their pension savings accounts.

After promulgation, the project went to the Comptroller’s Office to comply with a bureaucratic procedure, and after it is soon published in the official gazette, some nine million people will be able to withdraw from their pension funds a minimum equivalent to 1,400 dollars –the Those with less can withdraw everything – and a maximum of up to $ 6,160.

The private Pension Fund Administrators, after receiving the funds withdrawal requests, will have about 15 days to make the transfers effective.

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