for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
Financials

Peru court scraps law allowing withdrawals from state-run pension system

LIMA, Feb 4 (Reuters) - Peru’s Constitutional Court on Thursday tossed out a law that would have allowed the partial withdraw of savings by citizens enrolled with state pension fund, a measure that had prompted fierce opposition from interim President Francisco Sagasti.

The court said in a statement that it had voted unanimously to overturn the law, calling it “unconstitutional.”

The law passed by opposition members of Congress in December, intended as a lifeline for those in need amid the coronavirus crisis, would have allowed members to draw up to 4,300 soles ($1,192) from the state-run system.

Most Peruvians prefer the larger, privately-run pension system, but many state-workers, and some in private business, opt instead for the state-run plan.

The bill’s passage came just weeks after lawmakers approved two similar withdrawals from the country´s parallel, privately-run system.

Sagasti’s administration, however, had warned that tapping the state-run system would further decimate public coffers, already in dire straits as Peru, the world’s No.2 copper producer, struggles through one of its deepest recessions in decades. (Reporting by Marco Aquino Writing by Dave Sherwood; Editing by David Gregorio)

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up