IESS system faces collapse as government doesn’t pay its debt; Party buses are part of Cuenca’s night life; Protect yourself against extortionists
Hola, Todos –
Con gol polémico gana el Barcelona (Barcelona wins with controversial goal) – <And that’s all I’m going to translate.>
De El Mercurio del sábado, 23/9 (1 headline article):
Deuda millonaria al IESS (Millions in debt to IESS) – María de los Ángeles Rodríguez, the employers’ representative on the Board of Directors of the Instituto Ecuatoriano de Seguridad Social (IESS), sent an official letter to Pablo Arosemena, Minister de Economía y Finanzas, asking that the Government pay what is owed to the Pension Fund. As of el 19/9, the debt rose to $1.25 billion which puts the sustainability of the system at risk. The Government budget for 2023 included a payment of $2,186 billion to IESS, corresponding to the 40% it is required to pay into the Pension Fund. It paid only $338 million for enero y febrero, 2023, but hasn’t paid the $200 million for marzo or anything after.
Rodríguez’s letter warned of the seriousness of the arrears which has forced IESS to divest about $480 million from BIESS (the Social Security Bank) to pay pensions. This could rise to $1,511 billion by the end of the fiscal year. Draining the Pension reserves started with the 2015 decision by Rafael Correa’s government to stop contributing the Government’s 40% share to the IESS which provoked a loss of $8.927 billion which has since been whittled down to a little over $6 billion.
According to Carlos de la Torre who led a Citizens’ Commission to analyze the IESS situation, the life of the Fondo de Pensiones is barely 5 years after which it won’t be able to pay pensions. This life will be shortened if the Government continues to not pay its 40% share. Not paying the 40% causes other losses since collections from mortages and signature loans won’t be transferred into BIESS for investments, but will be used to cover the monthy financial gap in the payment of pensions.
While the Government is not paying its 40% share into the Pension Fund, authorities at BIESS are financing the National General Budget by buying government bonds. <Would that be considered throwing good money after bad? How high is the risk of default right now?> BIESS has bought about $1.627 billion in bonds, bringing its support of the National Budget up to about$2.877 billion. This money is from the contributions of affiliates, retirees, and beneficiaries of IESS.
<See related article in National section below.>
De El Mercurio del domingo, 24/9 (2 articles):
Las farras cuencanas ‘rodantes’ (The ‘rolling’ cuencan parties) – Party buses are on the streets of Cuenca. These chivas are recognizable by lots of lights, decorations, music, and happy celebrants. They are rented by small and large groups to celebrate all sorts of occasions – bachelorette parties, quinceañeras, graduations and more. The chifas from Vanservice are similar to the trolleycars in San Francisco. They’re red with a little balcony on the back. The rolling party lasts as long as the client wants with the most common a tour of 2 hours that costs $200. Also popular is a start at 20:00 lasting until 1:00. <These must be Cuencano clients – old gringos would be more apt to ask for a start at 17:00 and finishing at 20:00.>
The client specifies the pick-up point. Routes are designed to cover points like the Centro Histórico, Turi and main streets in the City. The longest route is into the Cajas. Buses are equipped with a bar for hosts to serve their own beverages. Chivas have a capacity of 30 people as well as up to 60. To rent a chiva, contact Vanservice on their social networks.
Servicio con fines sociales (Service for social purposes) – La Empresa Vanservice has been promoting tours in ‘chivas’ since 2020 with gap during the pandemic. It also offers double decker bus service. In 2023 it is offering 18 free tours for foundations and organizations with a social purpose. The foundation must first show that it works with people from vulnerable groups. To book one of these trips, you need to send your application to 099 977 4589 or email firstname.lastname@example.org and explaining for which persons the free service is being requested.
De El Mercurio del sábado, 23/9 (1 article):
Extorsiones, un delito asfixiante en Cuenca (Extortion, a suffocating crime in Cuenca) – Large businesses are not the only victims of extortion. Extortionists are now attacking regular people. Two examples are a driver who was hired to take passengers out of Cuenca. After he picked them up, they showed him fotos of his wife and daughter and demanded daily payments to leave the family alone. He has paid about $5,000 in 3 months. A second man was called about 2 weeks ago by someone who knew his name and said he was part of the Los Choneros gang. The extortionist said he saw that the victim was having problems with a couple of neighbors who had hired the gangster to make the victim disappear. The victim hung up and blocked the number. He is now very careful in his daily activities. <And you were all worried about identity theft and protecting your social security number, birthday, etc. But have you been cluelessly posting your daily activities and bragging about your new car, TV, Rolex, or whatever? Or if you’ve been careful, can you trust all your contacts kept their mouths shut or are they posting fotos of Beavis’ new $10k watch?>
Authorities are telling people to immediately report these crimes so that the Prosecutor’s Office and Policía Nacional can investigate. Both have special units to investigate these types of cases. One father reported his teenage son had been extorted by two other teens. The kids were caught. Reports can be made at the office on Paseo Paucarbamba y av. Paucarbamba. The only requirement is your cedula. You do not need a lawyer for this process. <Unless you’re also telling the police where they can find the body of the extortionist, and that you want your knife back.>
You can also attach material related to the extortion such as text messages, call records or other material. Authorities also recommend that you take precautions. Very often, the extortionists take advantage of public information from social networks. Police said if you allow the extortion, the criminals keep coming back. The best thing to do is report the crime to stop the situation.
De El Mercurio del sábado, 23/9 (1 article):
Impacto a Fondo de Pensiones (Impact on Pension Fund) – President Lasso sent a decreto-ley (law by decree) to the Corte Constitucional (CC) el pasado 5/8 which would let the Government write off what it owes to IESS in interest charges for late payments to the Fondo de Pensiones. Patricia Borja, an expert in Social Security issues, presented an amicus curiae to the CC to explain the seriousness of the Government’s intentions and said the amount it is seeking to have forgiven is about $1 billion which would further affect the Pension Fund reserves. This would be a total violation of the criteria of sustainability of the IESS, and in addition, it is illegal. The funds already in the IESS system can not be touched since they belong to the members and pensioners.
And that’s all for today so hasta ? –
Editor’s note: Jeanne’s Periodico is a translated digest of news from the Cuenca daily newspaper El Mercurio. If details, such as event dates and times, do not appear in the translation, they did not appear in the newspaper (please don’t ask her for them). If information is incorrect, they are the responsibility of El Mercurio. The text between the carrots, or guillemets (< … >), is Jeanne’s personal opinion and not part of the news translation.