Cost of the Pension System Will Rise $65 Billion with Reform, Fiscal Impact Worries

Labor and employment attorney Camilo Cuervo was quoted in an article published by La República about the pension reform under discussion in the Colombian Congress. The article highlighted Mr. Cuervo's analysis of the fiscal concerns generated by the proposal, which could increase the country's pension liability by 64 billion Colombian pesos. He warned that another worrying aspect was the possible use of the pension resources currently saved by workers, which amounts to 400 billion, to finance the subsidies for older adults and people without income. Amid the legislative debate, he noted the need to find a balance between the subsidized base that the state would guarantee and self-managed individual savings.

"There is a middle ground in that reform is needed and in the unification of the systems, but not in the way the government has proposed it," he said.

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