Despite the warning made by the Fiscal Control Board about the economic impact that the implementation of Law 80-2020 on incentivized retirement will have, the administration of Governor Wanda Vázquez began the first phase of the program, opening the process of application to public employees.
With this first step, the government seeks to determine the number of public servants who wish to benefit from the program to confirm the budgetary impact of the implementation of Law 80, as confirmed by the Financial Advisory Authority and Fiscal Agency (Aafaf). While this is happening, the agencies have already begun to circulate written communications to their employees so that they can fill out the form that has been required to qualify for the incentivized retirement.
The head of the Retirement Systems Administration (ASR), Luis Collazo Rodríguez, told THE SPOKESMAN that the statute makes possible millionaire savings in payroll to the government, at the same time that it does justice to the officials eligible to the provisions of Law 447-1951 of the Retirement System and Law 1-1990, which changed the benefit structure contemplated to stop Retirement’s multi-million dollar actuarial deficit. However, the fiscal board has indicated that Law 80 will have a negative economic impact of $ 4.2 billion.
Collazo Rodríguez said yesterday that the government has consistently provided the regulator with all the information, documents, actuarial studies and savings projections on Law 80. “With the issuance of Circular Letter 2021-01 and the corresponding forms on October 15, 2020, began the implementation of the law that was approved on August 3, 2020 and remains in full force, “added the official in written statements to this medium.
He specified that after the issuance of the circular letter, the ASR provided employers with the registry of eligible participants by agency so that they can analyze whether they wish to participate in the program. Collazo Rodríguez specified that to address some of the concerns of the board, it was determined to implement the law in phases.
The ASR administrator said that the first stage consists of the election period for qualified employees to decide if they want to join the program. This election period ends on December 23. After that date, employers have 30 days to send the completed registry of eligible workers to the ASR and the Office of Management and Budget (OGP).
“This first phase is vital to be able to know with certainty how many employees wish to benefit from the program and thus be able to calculate in a more precise and detailed way the savings and the budgetary impact of Law 80. Therefore, the implementation of Law 80-2020 continues, ”said Collazo Rodríguez, adding that there are 6,934 eligible participants under Law 447-1951 and 10,974 eligible participants under Law 1-1990.
Along the same lines, the Aafaf indicated that the public policy of the current administration is to protect the pensions of all those retired from public service, so they will continue working in that direction.
“The government has provided the Fiscal Oversight Board with all the information they have requested in reference to Law 80, including circular letters, memos and other related documents. The implementation of this law —which is led by the OGP and the Retirement Systems— is divided into several phases “, declared the Aafaf.
He assured that the dialogue with the regulatory body and the agencies continues to make way for the later phases of the law.
Agencies send notifications
In accordance with the above, the agencies have notified employees so that they know how they can benefit from the retirement program. In the Department of Justice, the assistant secretary of Human Resources, Christian Castro Plaza, issued a written communication dated November 17, explaining the procedure that the agency staff and attached agencies must follow to fill out the form and apply for the incentivized withdrawal.
In the notification held by THE SPOKESMAN, Castro Plaza reported that on November 13 was notified via email, the election form to benefit from the incentive retirement program to those employees in the eligible registry notified by the ASR and who are protected under the provisions of Law 447- 1951.
“Thus, the ASR did not include in the registry of eligible employees covered by Law 1 of February 16, 1990. Consequently, and subject to the approval of the Fiscal Oversight Board, the implementation of the program in the Department (of Justice) will be of exclusive application to the participants of Law 447 ”, Castro Plaza expresses in the written communication.
Regulatory entity does not yield
However, the spokesman for the fiscal board, Edward Zayas, stated that the fiscal entity maintains its position of urging public employees “to be aware that they should not depend on the benefits provided under these laws … until this has been resolved. tax matter ”. Zayas refers to laws 80-2020, 81-2020 and 82-2020, which expand retirement benefits.
Law 80 creates the incentivized retirement program; 81 provides a “dignified retirement” to police, firefighters and custody officers, among others; and 82 amends Law 26-2017 on compliance with the fiscal plan, for the benefit of teachers in the public system.
Last Monday Ramón Luis Rivera, president of the transition committee of the governor-elect, Pedro Pierluisi, recommended that public employees not take advantage of a retirement program until there is a final determination of the fiscal board.