Argentine opposition tries to repeal pension reform

Xxxx Xxxxx Xxxxxx xxxxxxxx at xxxxxxxxxxx.xxx
Mon Jan 8 15:39:32 MST 2001


http://www.argentinenews.com/

UPDATE 1-Argentine opposition tries to repeal pension reform

 January 4, 2001  4:50pm

Source: Reuters
(Recasts, adds comments by Roggero)

By Carlos A. DeJuana

BUENOS AIRES (Reuters) - Argentine efforts to cut spending through a
series of IMF-backed reforms to the country's pension system came under
fire Thursday as legislators promised to overturn the presidential
decree that put them in place.

Humberto Roggero, head of the lower house's opposition Peronist Party
bloc, and congressmen from the Frepaso wing of the ruling Alliance
coalition, said they hoped to strike down a decree signed by President
Fernando de la Rua last week. Among other changes, the decree cuts
government contributions to pensions and lifts the age of retirement for
women to 65 from 60.

 The Frepaso's opposition to the pension reforms is the latest sign that
De la Rua's Alliance, which also includes his centrist Radical Party, is
having trouble  staying together.

The decree was part of a battery of economic reforms De la Rua unveiled
last week in hopes of reining in a gaping fiscal deficit and bringing
Latin America's  third-largest economy out of a 30-month slump.

The government also promised the pension reforms in exchange for a new
$13.7 billion credit deal with the International Monetary Fund (IMF),
part of a larger  $39.7 billion financial aid package announced last
month that hopes to quell fears the country may default on debt
payments.

De la Rua circumvented a long congressional debate on the reforms by
decreeing them, but now he must fight to keep them alive.

Already a decree deregulating the union-run health care system has been
suspended by a judge, and Roggero said in a news conference Thursday
Peronist congressmen would file similar court appeals to have the
pension decree ruled unconstitutional.

If that fails, the Peronists plan to introduce a bill once Congress
reconvenes in March that would reverse the decree.

``We think it is an indispensable necessity that society once again face
off against these cuts,'' Roggero said.

Frepaso deputies Hector Villalba and Maria America Gonzalez also said
they would create a committee to analyze the best way to repeal the
decree and come up with an alternative.

`The idea is...to repeal the decree and pass an alternative law that
will bolster the pension system without hurting people, and find a way
of financing it without a deficit,'' said Eduardo Macaluse, a deputy
with the left-leaning Frepaso.

According to officials at the Economy Ministry, Argentina's pension
system runs a $3 billion deficit each year -- a gap the government
urgently needs to close as it tries to balance its budget by 2005.

 ALLIANCE ON THE ROCKS?

Cracks in De la Rua's Alliance became widely visible in October when
Frepaso head Carlos Alvarez resigned as Vice President in a huff over a
Senate bribe-for-votes scandal. Alvarez has said the pension reforms
will have a ``negative impact'' on society.

But Economy Minister Jose Luis Machinea said Frepaso complaints that its
voice was being ignored were unwarranted.

``In contrast to what has been said, we never made a move without
consultation. We ended up making the move we thought best for Argentina
after many talks with legislators from both the Radical Party and
Frepaso,'' Machinea told reporters.

The pension reform that De la Rua decreed last week included various
modifications such as not phasing out a state-run pension scheme that
would have disappeared in the original proposal.

               (Additional reporting by Cesar Illiano) ^ REUTERS@

--

Xxxx Xxxxx Xxxxxx
PhD Student
Department of Political Science
SUNY at Albany
Nelson A. Rockefeller College
135 Western Ave.; Milne 102
Albany, NY 12222



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