Pension rulings could cost Colombia $21 billion: Finance Ministry

A report released by the Colombian Finance Ministry argues that rulings by Colombia’s judiciary could cost the country as much as $21 billion, newspaper El Espectador reported Wednesday.

The report claimed that rulings from Colombia’s judicial system that have held up the unification of pension schemes have significantly raised the cost of pensions of public employees. The current rulings have only affected workers in Colombia’s judicial departments and are estimated to have cost the government $6.6 billion and $11.4 billion in 2010.

The Finance Ministry reported that if the rulings were extended to all public employees, the cost would jump to as high as $21 billion. If the rulings were applied to workers in the private sector the ministry predicted costs as high as 15-20% of Colombia’s GDP.

Colombia’s Judiciary has issued rulings that allow members of its workers to benefit from pension benefits that should have expired as Colombia unifies its pension program. Under a law passed almost 20 years ago, Colombia has attempted to unify its pension programs to offer the same rules and opportunities to everyone. This process has been held up in some government sectors by judicial rulings.

The report noted that there are currently no control mechanisms to prevent courts from issuing rulings that benefit the judiciary.

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