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The Government proposes to repeal the moratorium on pensions: what will happen to those who have not completed 30 years of contributions

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This is proposed by the new mega bill sent to Congress repeals law 27.705the last and most important pension moratorium (“Pension Debt Payment Unit”) approved in March 2023, for 2 years, extendable for another 2 years. The remaining moratoriums are maintained but, being very early, over the years they have almost no impact on access to pensions.

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According to that law, that was questioned by the International Monetary Fund in 2023 they retired 460,000 people (8 new pensioners out of 10) mostly women. And whether it will be repealed, due to the very high informality, from now on They will only be able to access the PUAM (Universal Benefit for the Elderly) at the age of 65, (both men and women) with the 80% of the minimum assets, without the right to a widow’s pension, regardless of the years actually paid, and if they demonstrate that they are in a situation of social vulnerability. The value of PUAM in April is $207,026 ($137,026 plus $70,000 bond).

Law 27.705 has two variants:

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  • The first method includes people who have reached retirement age (60 years for women, 65 for men), who do not have and will not have 30 years of contributions in the next few months to start the pension process.
  • The second variant is intended for women over 50 and under 60 and men over 55 and under 65 who already know that they will not be able to complete their contributions once they reach retirement age.

In the first case, they can regularize the missing periods up to and including December 2008 by applying a installment payment method that will be deducted directly from the retirement income earned. The number of installments can reach up to 120 months.

The installments to be paid for the monthly payments to be regularized are calculated according to the so-called “Pension Debt Payment Unit”, the value of which is equal to 29% of the minimum salary tax base in force on the date of requesting the pension benefit. . You can pay, for example, one or more units per month, depending on the payment plan you choose.

But that amount that will be paid will only be used to access the pension. It will not affect the credit, which will be calculated on the basis of the contributions actually received without a moratorium.

In other words, those who retire with the moratorium will have a “discount” on their pension because they will only receive the contribution years and will also have the discount of the contribution on their assets during the months or years of duration of the moratorium.

The second variant is intended for women over 50 and under 60 and men over 55 and under 65 who, having only a few years of contributions, already know that they will not be able to turn 30 once they reach retirement age.

Those who can demonstrate income that allows them to justify the payment of the debt deriving from the “Contribution Cancellation Unit” for periods prior to 31 March 2012 can make use of this mechanism. The value of this Cancellation Unit (UCDP) is also equal to 29 % of the minimum tax base. This amount is adequate for mobility.

If Law 27705 is repealed, the following effects will occur:

  • Those who do not reach 30 years of contributions will be able to access the PUAM upon reaching 65 years of age with 80% of the minimum assets, plus possibly the bonus, regardless of the years actually paid. The most affected will be women because today they can retire through the UDPP at 62 years of age or less by appealing for the recognition of the pension for childcare duties, and in this way from now on they will not be able to complete the missing years and they will have to wait until they are 65 to access the PUAM, according to lawyer Anibal Paz.
  • Those who are less than 10 years away from retirement can regularize their contributions by paying off the debt, so as to reach 30 years of contributions when they reach retirement age. . But leaving it null if the official project were approved, it would mean that only 2 people out of 10 will be able to retire given the very high level of working informality (people employed without contributions or pension discounts), says the lawyer Andrea Falcone.

For its part, if the project is approved, the regulations It is necessary to clarify what happens to those who have already completed the plan or are in the process of paying for it or they already have an appointment at ANSeS to carry out the procedure. It is assumed that their acquired right must be respected.

Source: Clarin

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