The Pension Crisis in Argentina

By: Armonia Diaz
Comments to the Special Event Panel
"Critical Emerging Issues for Older Persons"
World Summit on Social Development
(Copenhagen, March 6, 1995)

I am addressing this outstanding International Assembly on behalf of the old age pensioners from Argentina, as a member of the National Council of the Coordinating Board of Pensioners from Argentina (one of the leading organizations), and as the Intercenter president of the same organization. Together with 41 other national groups, we make up the Permanent Plenary of the Pensioners' Organizations. These groups have been holding protest demonstrations every Wednesday in Buenos A I am addressing this outstanding International Assembly on behalf of the old age pensioners from Argentina, as a member of the National Council of the Coordinating Board of Pensioners from Argentina (one of the leading organizations), and as the Intercenter president of the same organization. Together with 41 other national groups, we make up the Permanent Plenary of the Pensioners' Organizations. These groups have been holding protest demonstrations every Wednesday in Buenos Aires for over 150 weeks running. They are accompanied and supported by solidary groups of our community, and they wish to express how much their situation has deteriorated since these marches began, in the same way as the situation of millions of Argentinians who are undergoing the highest unemployment rates ever in the history of our country.

The globalization of the world's markets, and the economic dependence assumed by our government with respect to the de mands of the creditor banks, and the power of the great economic groups has led workers whether active or passive to a situati on of defenselessness and exclusion from the cultural, social, and economic development of our country.

The bunch of laws and need and urgency decrees put forward by the national government has only been aimed at the proper balance of accounts, the fiscal deficit, and the enlargement of the foreign debt, thus setting at stake the survival of over two thirds of the population of our country. Let us set an example taken from the latest events, and we will watch the haste that our Economy Minister, Mr. Domingo Cavallo, has had to get the approval of t group of laws, among which we can menti on the (so called ) Law of Provisional Solidarity, Law of Labor Accidents, and Law of Labor Flesibilization, whose main aim is to try to avoid the effect of the Mexican crisis (laying all the efforts on the workers and on the pensioners ).

As we have already reported before the Interamerican Board of Human Rights, the Provisional Solidarity Project violates international treaties signed by our government, which have been added to our Constitution.

This project, which already has the approval of our Lower Chamber, comdemns third age people to a massive supression, and becomes in itself yet a new genocide. It validates the present situation and tries to support a new theft from funds that, by National Law, had been allotted to the payment and rise of pensions.

The money that had been allotted for these purposes has been used up by making payments to the provinces, (which is a State commitment), and anticipating the due dates of bonds with which the government had settled its debts with the pensioners, who had to sell these bonds in some cases, at 30% of their original value, and working expenses of the DGI (Income Tax Office), and military and other security forces pensions, in the years 1993 and 1994, whereas it should have been taken from the national budget for these years.

On top of that, these is a permanent loss of funds, with undue decreases of the companies' social security payments (decree N 2609) which bringsabout a yearly loss of funds of over 80 million dollars, and monthly payments to the Private Pension Administrating Companies of over 200 million dollars. All in all, this would amount to 9 points in salaries, witnout the funds for these rises being provided for.

In this way, our country is unavoidably being led to a struggle between the poor, who get poorer every day, and the rich and famous, who become richer and more famous every day.

So far, the government can count with the supoport of the majority, in both chambers of Congress, who obey the orders of the Executive power. The Law system also compromises with the government, which turns all 5his into a grotesque masquerade.

We have taken a dangerous road leading to nowhere. This is just a frontal attack on everything that has to do with social issues, and these laws have been laid by the World Bank, and the International Monetary Fund, with which the government has compromised in the name of our country for every and anon.

Therefore, in this way, the government is doing away with pensions and substituting "social charity" for them. The Economy Minister seems to be the accountant of the country, and dreams of having a unique account from which he can handle all the security system funds as will suit him best, among other things, to end the fiscal deficit and get clear commercial balance, besides paying the interest on the external debt. In this way, the social services (among them FAMI which is the institute for social services of the pensioners), are giving away their funds to support the "Superminister".

If this law is set up, the pensions will no l onger have the guarantee of the National State, and will be paid with the funds available at the time of payment. All this is about the change from definite to indefinite services. This makes it impossible to proceed, as the Supremem Court established, that the payment of a pension should stand for the payment of a salary. Wiith the administration in the hands of the State, it will also decide on payment delays, exemptions, judicial charges, acceptance of evasion since the obligations of the government are decided upon at the administrator's will, and not by law. These are the "advantages" of an only central administration. The Inyternational Labor Organization, with which our country has signed agreements, recommends its members not to defraud the right to expectations. In our country, that right has been valid since 1904, and the expectation is of roughly 30 5o 40 years, and besices, this expectation is directly proportional to the activity the person has carried out, thus making it possible for a retired person to keep the lifestyle to which he is accustomed when he retires. Our National constitution states that these benefits (pensions) should be movable in the same way as the salaries of the people who are at work. If this is not done, an unfair distribution of wealth is created. As if this were not enough, they want to make this law retroactive, implying that we do not and will not have an implicit right to our pensions.

This project is obviously against the law, and implies a reactionary concept of social security, such as has been suggested by international organizations which set the priority on the payment of illegitimate debts, rather than on the health and welfare of the individual.

Therefore, we wish to make use of the possibility we have been given, expressing our ideas before this high international summit, in order to report all this, which we have already reported before national, regional, and international organizations of human rights.

The so-called SOCIAL SOLIDARITY PROJECT violates several statements of the American Convention of Human Rights, and also the principles of the American Declaration of Rights and Obligations of Men. We denounce that since a person's pension is supposed to be enough to feed him. Its decrease to figures that are ridiculously disproportionate to the amount of money needed for one's survival, leads to the massive suppression of third age people.

Let us make figures talk. The National Institute of Statistics and Ce sus has established that, up to December 30, 1994, the monthly budget for a retired couple to survive in Argentina is of US $ 1085 (this includes only one strong meal a day), and 93% of pensioners receive less than US $300 a month, the pensions having been frozen at US $150. This situation has been worsened by the destruction of the pensioners' social security system. The national government, availed by a submissive Parliament, has been able to include the budget of our Institute (PAMI) inside the National Budget. THE STATE DOES NOT CONTRIBUTE EVEN ONE CENT

Even though PAMI (Pensioners Institute for Social Services) is not a State organization, it is permanently being audited by the government and when it is not audited it does whatever the government wishes. It is subject to scandals and dirty businesses, such as the one that took place in February 1994 with its president, who had been appointed by the National Government. Screened behind this social security system, which is the biggest in Latin America, are the big monopolies of private medicine, the world Bank and the Interamerican Developm3nt Bank.

The government wants to statize and then sell the Institute and thus the pensioners will have it to them selves to look after their illnesses. This goes al ong with the destruction of the pension system, already voted bvy Parliament. Pensions will be paid according to the amount of money the government can set aside for them in its yearly budget. If the budget can include the money for the pensions, they will ne paid; otherwise, they will not. Also the governm,ent decides on the amount of money to be allotted to the social security of pensioners. This share has already gone down with regards to medicine, X-rays, hospitalization, pensioners' homes, and so on, as proven by the documentation enclosed.

Therefore, and as a final statement from this important international summit, I beg the government of my country not to pass the so wrongly called Solidarity Law, and to return the PAMI to its legitimate owners, the pensioners.

Global Action on Aging
PO Box 20022, New York, NY 10025
Phone: +1 (212) 557-3163 - Fax: +1 (212) 557-3164

We welcome comments and suggestions about this site. Please send us your name for our postal and electronic mailing lists.