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The Congress of the Republic once again approved a law establishing recognition bonus for contributors and former contributors of the Office for Standardization of Pensions (ONP) who have switched to a private pension system since 2002.
Assertion at insistence law this was achieved by 86 votes in favour, 7 against and 14 abstentions, despite the initiative having previously been rejected by the executive branch.
Earlier, the Ministry of Economy and Finance (MEF) warned that these measures would mean the end of the ONP, as it would force all National Pension System savers to switch to AFPwhich would mean that the ONP pension fund would have to be fully funded by the State Treasury.
However, the president of the Economic Commission, Rosangela Barbaran, indicated that the executive’s comments were dismissed because the contribution of ONP affiliates who voluntarily decided to move to the AFP should be acknowledged.
What does this measure mean?
Through this law, the recognition bonus is updated after more than 20 years, as the contributions of affiliates who switched from ONP to AFP in 1992, 1996 and 2001 were previously known.
The measure now applies to those who decide to change ON PAGE AFP from 2002 and will work for those who choose to migrate from the system in the future.
Now, after the rule is promulgated, the MEF will have up to 12 months to issue a recognition bond.
According to the executive branch, it is estimated that about two million depositors in National pension system they can switch to AFP after the entry into force of the regulation.
Similarly, it is estimated that between 2022 and 2021, 3.1 million workers were transferred to AFP. Only with this number of branches, an economic effect of SGD 5,855 million is calculated.
But considering affiliates ON PAGE which may soon be transferred to AFP, the economic impact of this measure will be SGD 40,853 million.
Source: RPP
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.