VENEZUELANS will have to continue to wait for pension
system reform. The National Assembly in December granted a three-month
extension to the commission charged in August with coming up with a
pension fund law by the end of 2000.
The commission is now slated to present a preliminary proposal in March in
order to give the government-party dominated Assembly enough time to
discuss it and take a final decision by July 2001. A likely date for
implementation would then be January 2002.
"Time is passing as if this were not an urgent matter," fumed
Juan Jose Caldera, an opposition legislator. This is the second time that
pension reform has been delayed in two years.
The commission, which President Hugo Chavez had hoped would present a plan
by December, is said to be divided over whether to let private pension
funds operate in Venezuela, or whether to rely solely on a state-run
system. Chavez has said he favours a mixed system, but some hardline
leftists on the commission say pensions should be the sole responsibility
of the state to prevent speculation with workers’ savings. Others have
pointed out the costliness of a state scheme, noting that pensions awarded
to the country’s 1.9 million retirees would eat up 24% of the
Venezuelan workers and the financial sector have been eagerly awaiting
pension reform since 1998 when the previous government of Rafael Caldera
approved a private pension fund system. When Chavez took office in
February 1999, he immediately suspended that law pending a reform. The
current state operated pension system has not worked in Venezuela with the
government in constant arrears with payments and many workers having to
pay bribes to pension officials in order to get on the pension rolls.