Public Accounts

Without changing the pension pension system, another alternative pointed out by the secretary would be to reduce investments in education and health

The Economic Monitoring Secretary of the Ministry of Finance, Mansueto Almeida, reinforced on Friday (3) the need to approve the pension reform sent by the federal government to the National Congress at the end of last year. In the economist's view, the numbers show that without modifying the system, the only way to keep the payment of pensions and pensions would be by raising taxes.

In the scenario outlined by the Secretary of Economic Monitoring, there are two ways to go without the Social Security reform: taxes or cuts in important activities for the country, such as education and health. In Mansueto's calculations, the level of spending in Brazil to maintain this state of social well-being is similar to that of rich countries such as Canada.

According to Mansueto, Welfare and social assistance expenses represent the equivalent of 24% of the Gross Domestic Product (GDP) - half of this percentage is for pensions and pensions. With the aging population and the current rules, this bill may become priceless.

In a series of publications on a social network, the secretary passed on information that shows the current state of Social Security. "Welfare reform will prevent a fiscal disaster. Without pension reform, prepare your pocket to pay more taxes, "he said in his profile on Twitter .

Ageing Population

The data shown by the secretary shows that the population aged 60 or older will increase from 22 million in 2015 to 73.5 million in 2060. The population 65 years old or older will grow 262.7% in the period.

The projection is that these spending grow 10 percentage points of Gross Domestic Product (GDP) by 2060. "The problem of Social Security is not just the deficit. But also the strong growth of spending in the coming years, "he noted.

In this line, Mansueto recalled that there is already a minimum age of 65 for men in urban centers that can not contribute for 35 years. He also pointed out that retiring under 60 is not the poor. "In general, it is the middle and / or upper class (retiring before age 60). Poor people do not contribute for 35 years, "he argued.

"Brazil has a double challenge. Do a pension reform and still deal with the problem of rapid aging of our population, "he said. "Japan has not been able to make this transition and has grown less than 1 percent a year since 1990. Before, from 1960 to 1990, it grew 6.5 percent a year," he said.

Active debt

He further warned that charging government debtors would not be enough to solve the problems. Of the total social security credits receivable, only 4% had a high recovery chance.