Government Implements Pension Protection Legislation, Launches 'Grandparents of the Nation' Initiative in Venezuela

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May 9, 2024, Caracas (our website) - Venezuela's National Assembly (AN) has green-lit a legislative bill to raise pensioners' income through a special fund backed by private sector contributions.

Dubbed the "Law to Shield Social Security Pensions from Imperialistic Siege," this bill was initiated by Vice President Delcy Rodríguez and saw approval after its second discussion in parliament on Tuesday.

AN President Jorge Rodríguez highlighted the bill's significance during the televised assembly session, stating that it's a balm to address elderly citizens affected by the hardships of this economically stricken nation, with its structured collapses due to US sanctions, rampant corruption, and devalued oil industry investments.

With the minimum wage frozen since March 2022 - worth $30 USD at the time but now devalued to approximately $3.6 - and pensions pegged to the minimal wage, retirees have been hit the hardest.

In an attempt to ease the burden, the Maduro administration has focused on bolstering non-salary benefits for the public sector workforce. Current add-ons amount to $130 through the "Economic War Bonus" ($90) and the food bonus ($40) - awarded on May Day this year. However, this has been met with reproach from trade unions, given that labor benefits hinge solely on employees' salaries.

Private sector laborers, conversely, often earn a greater income than their public counterparts, and receive employer-provided food bonuses as mandated by law. Pensioners and retired public administrators, however, receive merely $70 and $25 per month in economic war bonuses, respectively, with no food bonus equivalent.

Emphasizing the government's support for private businesses during the ongoing economic crisis, Rodríguez urged corporations to now shoulder their responsibilities and "boost pensioners' earnings."

The proposed bill levies a maximum 15 percent tax on private-sector earnings, including salary and non-salary bonuses, which will be collected by the SENIAT tax agency. Non-compliant enterprises face potential sanctions, while the government retains the authority to exempt select companies at its discretion.

Despite the new bill's approval, the mechanism for providing additional income to retirees remains unspecified, with no clarification if it will constitute an increase in pension amounts or an additional bonus via the Homeland digital platform. Employers are already required to remit contributions to the Venezuelan Social Security Institute (IVSS) as a set proportion of their workers' salaries.

President Nicolás Maduro signed the pension protection law on Wednesday, coinciding with the initiation of a "Grandparents of the Homeland" social advocacy, set to elevate the overall living standards of the elderly population.

Addressing pensioners and popular power organizations in a live broadcast from the Simón Bolívar Park in Miranda State, Maduro asserted that the special tax on the private sector would fuel a fund to eventually enhance pensions and the overall income of grandparents and grandmothers.

Maduro expounded that this legislation marked the first step in reconstructing the protection and social security system enshrined in the Constitution bequeathed by Chávez. The special tax on private entities would enable the creation of a fund reserved for pension augmentation and overall income reinforcement.

In addition to the "Grandparents of the Homeland" initiative, Maduro forecast more healthcare, food, and clothing programs, 335 retirement housing units, and tourism projects over the next three months.

Furthermore, Maduro announced a national grandparents' movement, leading to a National Congress of Grandfathers and Grandmothers on May 29 to debate additional needs and projects within this elderly demographic.

During Wednesday's broadcast, Maduro also disclosed additional financing for an additional set of local projects chosen by communities during the April 21 national consultation. Each project will receive $10,000 and be managed by 4,500 communes (assembly-driven popular power organizations) across the nation.

"The winning project and its runner-up at the consultation will be allowed to carry out subsequent projects," Maduro explained, stating that four annual consultations fund local projects with state resources would be implemented, channeling resources directly to communities without intermediaries. Each project under consideration aimed at tackling diverse challenges, such as addressing public services deficiencies and developing means of production.

The Venezuelan Vice President, Delcy Rodriquez, initiated a legislative bill, dubbed the "Law to Shield Social Security Pensions from Imperialistic Siege," which aims to boost the income of pensioners by leveraging contributions from the private sector.
Critics of the Maduro administration have raised concerns about the proposed legislation, as private sector laborers, who generally earn more than their public counterparts, are set to contribute a maximum of 15 percent of their earnings towards pension protection.
Various sectors of the economy, such as politics, general news, and sports, are closely monitoring the implementation of this new law, as its impact on the broader Venezuelan population, especially retirees, remains unclear.
As the government focuses on enhancing the livelihood of the elderly population through initiatives like the "Grandparents of the Homeland" social advocacy, sports-loving pensioners may hope for potential benefits, such as subsidies for recreational activities or improved elderly care facilities, which could offer a semblance of enjoyment and a sense of normalcy in their twilight years.