ARGENTINA: Social Security for the Few, ‘Insecurity’ for the Rest

By Marcela Valente Reprint | | Print |

Marcela Valente

BUENOS AIRES, May 20 1999 (IPS) - A political scandal broke out this week in Argentina when it was discovered that the labour minister not only earned a salary of 10,000 dollars a month, but also received a monthly pension of 8,000 dollars.

The news was not well received in a country where 85 percent of pensioners have incomes below the 578 dollars a month calculated – by a section of the labour ministry itself – as a subsistence- level income.

Labour Minister Antonio Erman Gonzalez claimed that he had never simultaneously received both his salary and the retirement pension he began to be entitled to 15 years ago, after working in the civil service in the northern province of La Rioja as an employee of current President Carlos Menem, governor of the province at the time.

Gonzalez refuted newspaper reports that he had infringed the law prohibiting public officials from simultaneously receiving a government salary and pension.

But new evidence provided by the Social Security administration officials who denounced the minister to the local daily ‘Clarin’ in the first place indicated that he had already been paid 250,000 dollars in back pensions.

“We’ll see what I’m going to do. I’m not in a position to donate it,” Gonzalez told reporters.

In La Rioja, Gonzalez served as minister and director of the province’s Central Bank. When Menem was first elected president in 1989, Gonzalez was designated economy minister, and later minister of health, defence and labour, besides serving as ambassador to Italy.

But the minister is just one of 15,000 public officials who benefit from the so-called “privileged pensions,” which according to the ‘Mesa Coordinadora de Jubilados y Pensionados’ (Coordinating Committee of Retirees and Pensioners) are as large as 50,000 dollars a month in a few cases.

Half of the “privileged pensions” were the result of a system set up in La Rioja, which ensured bulky pensions for some 7,000 civil servants who had only spent a few months in public posts, without setting a minimum age for retirement, unlike the national social security system.

The current deputy governor of La Rioja, for example, has already arranged – at age 46 – his special future pension of more than 6,000 dollars a month.

Besides the beneficiaries in La Rioja, a number of economists, former legislators, ministers and public employees – who served under civilian governments as well as dictatorships – receive pensions of 10,000 to 18,000 dollars a month.

The legislation allowing the “privileged pensions” was revoked, but without retroactivity – in other words, the beneficiaries of the special pensions continue to receive them. Only a few forfeited that right.

The scandal took on even greater proportions due to the contrast with the situation of 85 percent of Argentina’s nearly four million pensioners, who receive less than the mininum income needed for subsistence, estimated at 578 dollars by the ‘Secretaria de la Tercera Edad’ (Secretariat of Senior Citizens) – a section of the ministry headed by Gonzalez.

According to the Secretaria, two people with no one in their care and no rent to pay can scrape by on 578 dollars a month.

Most of the pensioners in this Southern Cone country belong to the category of the so-called “new poor” – people whose incomes put them below the poverty line, even if they are educated and have housing and health care.

The reports on the labour minister’s huge double income – which he does not seem willing to relinquish – triggered a spate of phone calls to radio and TV talk shows by people who insulted Gonzalez and bashed the Menem administration.

The minister argued, however, that rather than coming in for criticism, his case “should serve as an example for the young.

“From a background of poverty, I reached the highest levels, and today can begin to enjoy the fruits of an entire life dedicated to work” – an ironic statement in a country suffering unprecedented levels of unemployment in the past few years.