New pension and retirement regimen

The original bill had been sent to Congress by the Executive Power on October 21, 2008. The Law will come into force when it is published in the Official Gazette.

The main provisions of the law were commented in an earlier edition of Marval News (please see “Bill introducing changes to the Pension and Retirement System” in Marval News # 77 of October28, 2008). The changes introduced by Congress are the following:

(i)            the elimination of the second paragraph of article 3 of the bill, which allowed workers within the private pension system to consider the time that their contributions were managed by the pension fund managers as if they had been made to the public pension system, as regards the calculation of the additional retention benefit ruled under article 30 of Law No 24,241;

(ii)           resources received by the Government from the private pension system and the amounts of the new pension system may only be used to pay pension and retirement benefits.

(iii)          investment limits and restrictions;

(iv)          the Administración Nacional de la Seguridad Social (“ANSES”) shall collect no fees for the management of the pension funds;

(v)           the creation of an advisory body that shall control the investment of the pension and retirement resources (Consejo del Fondo de Garantía de Sustentabilidad del Sistema Integrado de Jubilaciones y Pensiones); and

(vi)          the conditions under which pension fund managers’ employees could be hired as Government’s employees.

Many of these issues still need to be defined by further regulations.