The cheating of the Social
Security Reform in Brazil
Cacildo Marques - Sao
Paulo
There is a massive and
almost complete lack of information within the population about the
current laws of Public Pensions in Brazil, which allows permanent
manipulation by rulers and the press.
First of all, there is
already retirement by age: 65 for men and 60 for women. In the case
of rural workers, one decreases five years in each genre.
There is also retirement
for contribution time: 35 years of contribution, for those over 53
years old, if male, and 30 years, for 48 years old, at least, if a
woman.
The above clarifications,
followed by more details, are in the FAQs of the Caixa Economica
Federal (CEF) website.
The most recent reform,
adopted in 2015, adds a requirement to prevent early retirements,
which is the rule 85-95, which since January 2019 became 86-96, as
planned. The meaning of this is that someone only has the right to
apply for retirement if, being a man, when adding up the contribution
years to the years of age gets a total of at least 96. If the person
is a woman, should reach a total of 86.
The difference of five
years between men and women did not come, as it was justified many
years later, because of the double female journey, in the employment
and at home. It was an invention of Colonel Jarbas Passarinho, who,
as a parliamentarian, by voting in the 1980s for reform that created
Special Retirement of Teachers, at 25 years of contribution, said he
did not agree with such low time for men, and made the project
determining 25 years for women and 30 years for men. Since then, the
discriminatory idea, aiming protection and discrimination of women
was extended to all subsequent social security laws. Today, this
special retirement at the 25 years of contribution was swallowed by
the minimum age of 60 years for male teachers and 55 years for female
teachers, according to the reform that entered into force at the end
of 2003.
The most significant
change in this 2003 reform was the establishment of the ceiling for
benefit receiving. In current values, the ceiling is at BRL 5,800 per
month (US $ 1,555 in February 2019). For a system that until 2003
paid pensions of judges with values of up to BRL 35,000 monthly
($ 9,383), this ceiling now solves the great problem of expenditures
with a range of public servants regarded as privileged. It is
necessary to remember that the immense mass of retirees receives
minimum salary, that currently is of BRL 954 monthly (US $ 256).
What would cause the
pension fund to maintain financial health? Let us see some necessary
steps.
First, what is collected
from the employee and employer's share, in equal proportion, is not a
tax, but a "contribution". Not being a tax, it should not
be mixed with national treasury money, but keep in own cash, managed
by a federal autarky.
Second, the value of the
employer's quota works as indirect wages, which could never be
postponed or denied, which means that the government must never waive
(dismiss) any employer to deposit this amount.
Third, informal jobs,
which almost never collect the contribution, should be hard pressed
to become formal jobs, and, even when informal, monthly contributions
should not be neglected. Large numbers of informal employment or
unemployment should not be allowed, so as not to provoke a vacuum in
the pension fund.
Fourth, it is okay to
pass money from the social security fund to the national treasury,
but this should only be done as loan, to be paid according to the
Central Bank's basic interest rate, at least.
Fifth, any beneficiary
whose value received does not derive from his social security
contributions, according to the minimum requirements, must have his
amounts paid for another type of cash, being part of another type of
government account other than the social security authority account.
This should be the case with the BCC (Benefit of Continuing Care for
the elderly), pensions for family members, etc.
Sixth, employers with old
debts, discounting the failed companies, should be called upon to
sign a plan of monthly pensions payment, in order to pay off their
debt over a number of years.
Seventh, companies that
do not collect the employer's social security quota must lose the
bank credit, until the fulfillment of the obligations.
Eighth, the employee who
requires retirement must "retire" in fact, as soon as the
service of his demand is published, being absolutely prohibited from
continuing to work in the same company and in the same place, even if
disguised as a legal entity.
Ninth, there must be an
annual audit, or at least a biannual one, in December, of all the
assets of the social security authority.
Tenth, there must be a
short time for the state and municipal systems to adapt to their
constitutions and organic laws the existing laws of federal funds.
All ten of the above
measures are designed to enforce current law, preventing drill holes
from leaking social security. There is, therefore, no need for
constitutional reform to detract more resources from employers or
public servants.
Why then do they want so
much a new reform? Because the sanitation measures listed above are
not applied. Contributions are mixed with taxes and social security
benefits payments are made with national treasury funds, in clear
disregard for the rite of separation of accounts. And as formal
employment is gradually disappearing, with acceleration guaranteed by
the new labor laws, the contributions of employees and employers,
tend to be reduced to an almost negligible amount in relation to the
total payments that pensions must make on a monthly basis, both to
direct payers of its cash and to beneficiaries with no relation to
contributions based on the salary.
As these problems are not
corrected, because one does not intend to do so, one can make a new
constitutional reform every four years, with the objective of
deceiving foreign investors, that the collapse will continue to
increase.
The dogma bragged by the
government that without the social security reform the country
returns to recession is talk without nexus, fruit of futurology of
reading coffee grounds. None of the reform topics submitted to the
National Congress in 2019 is positive for the country. Subtract more
resources from wage earners will only reduce national income, what
is, now yes, a faster way to return to recession.
