The Government announced a route to guarantee allowances November and December, but economists consulted warn that the causes of the imbalance of the public pension system They go beyond this year: the minimum wagehe aging population and the formula with which pensions are calculated.
The Comptroller warned in September that the public system It has a shortage of more than 4.2 billion pesos. He Ministry of Labor estimates additional resources at 5 billion to pay the allowances (monthly payments to pensioners) at the end of the year, and the minister Natalia Lopez He said there is a route to secure them.
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That system is managed Colpensions and is known as medium premium scheme. In simple terms, the contributions of those who work today help pay the pensions of those who have already retired and, when they are not enough, the difference comes out of the national budget. According to the Comptroller’s Office, the 44.6% of funding planned for 2026 It depends on those contributions from the Nation.
He This year’s imbalance was caused in the minimum wage. According to Anifthe increase was 23%compared to the 7.5% that was contemplated when programming the budget. The impact is great because, as of July, the 60.8% of pensioners of the public regime (1,176,819 of 1,934,498) I received exactly a minimum wage.
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The price of the minimum
Oscar Becerraprofessor of economics at the University of the Andes, explains that the Constitution prevents a pension from being lower at the minimum wage. Therefore, he says, “any increase in the minimum wage that is not budgeted becomes a hole in the accounts of Colpensions for that particular year.”
As an example, consider the case of a woman who retires at 57 with the minimum pension. If you are expected to live another 30 years, a 10% increase is a compromise for that entire period. “Any decision we make today can have an impact of 2530, 40 to 50 years easily,” he says.
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Jorge Llanoeconomist, and Luis Fernando MejíaCEO of Lumen Economic Intelligence and former director of the National Planning Department, point out another underlying factor: the demographic change. In it delivery systemyoung people pay the pensions of the elderly with their contributions, and Llano warns that this structure “makes water, because at the end of the day there are not enough people contributing“.
Mejía agrees: “In the face of increases in longevity and the reduction in birth rate, it is difficult to maintain a delivery system under current conditions.”
They both read differently 2024 reform. Mejía says he took an important step by reduce the pension subsidy from 25 to 2.3 minimum wages. Llano questions that he extended the distribution to that limit, something that, he says, I was going to widen the gap.
Luis Fernando Mejía, CEO of Lumen Economic Intelligence. Photo:Andrea Moreno. The Time
Is there a solution?
All three agree that we have to change the rulesalthough they differ on where to start. Flat focuses on savings: “The solution is to make a good pension reform. Do not carry out a reform like the one that was proposed and the one that was approved in 2024, but rather a good pension reform where it is effectively seeking that there is more pension savings as a percentage of GDP“.
That is, what is saved for old age compared to the size of the economy. Llano affirms that the countries of the OECD move in that direction and that “Colombia is the only one that has made a contrary decision“. In his opinion, a reform is needed that thinks “not only in the next elections, but in the next generations.”
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Becerra lowers the discussion to formula with which pensions are calculated of those who contribute. He says that “it is a formula that is systematically very generous”, since the typical pensioner “receives much more in pensions than he contributes or her.” Raising the pension age helpshe adds, but due to the transition regimes the effects would take 10 or 15 years.
Mejía adds to this reading: “The average premium system is still requires parametric reformsthat adjust the pension agethe replacement rate and the years over which the pension benefit is calculated.” The replacement rate is the percentage of the salary that is received as a pension.
The minimum wage for this year had an increase of 23%, a high percentage compared to estimates. Photo:ISTOCK
The minimum wage is more difficult to touch: Mejía remembers that the restriction is constitutional and states that “what must be ensured is that the workers’ incomes grow fasterbut not by decree, but by real productivity improvements“.
Becerra proposes Furthermore, the high pensions pay income taxsince they are the most subsidized (not talking about those with one or two minimum wages). For him it is “a message that we are all in the same situation, we are all in the same boat and We all have to contribute to the development of the country“.
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Another argument is that the resources recently transferred to Colpensionsbetween 25 and 30 billion pesos, would be enough to cover the gap. Becerra responds that Not all that money can be spent immediately.: “There is a maximum of 30 billion to cover a 5 billion deficit. If this deficit becomes permanent, the maximum would be enough for us in 5 or 6 years, and in 6 years, what do we do?”
Becerra is confident that the This year’s situation will be resolvedalthough with a significant fiscal cost. According to Anifthe pension reform is scheduled to come into force he April 1, 2027and Tax authorities has warned additional needs close to 5 billion pesos that would not be contemplated in that year’s budget.
María Alejandra Moreno Flórez
Economic Journalist
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