On July 22, the President of Mexico announced the presentation of a bill reforming the Social Security Law, in order to strengthen the Pension System through an increase in the amount of the pensions and an increase in the percentage of workers that will have access to a guaranteed pension.
Generally, the most relevant possible changes would be the following: (i) increase the tripartite contribution for retirement from 6.5% to 15%, without affecting the income of the workers and gradually over a period of 8 years; (ii) reduce the weeks of contribution to obtain a guaranteed pension from 1,250 weeks to 750 weeks; subsequently it will be gradually raised to 1,000 weeks in a period of 10 years; and (iii) increase the value of the guaranteed pension from a current average of $3,289 pesos to an average value of $4,345 pesos, in function of age, weeks contributing and base salary of enrollment.
Additionally, the bill includes the possibility of making withdrawals from the voluntary savings without a waiting period and seeks to eliminate the statute of limitations for obtaining the right to the pension.
It is important to mention that this bill is still not in the legislative process, and therefore it could suffer changes before being passed.
We are following the deliberations on the matter and will keep you informed.
To obtain additional information contact our experts:
Rodolfo Trampe, Partner: +52 (55) 5258 1054 | rtrampe@vwys.com.mx
Alix Trimmer, Associate: +52 (55) 5258 1016 | atrimmer@vwys.com.mx
Alejandro Pérez, Associate: +52 (55) 5258 1054 | alperez@vwys.com.mx