April 13, 2017 / 9:12 PM / 3 years ago

Brazil's Temer agrees to pension bill changes amid corruption probe

Brazil's President Michel Temer listens to questions from the media during LAAD, the biggest military industry expo in Latin America in Rio de Janeiro, Brazil, April 4, 2017. REUTERS/Pilar Olivares

BRASILIA (Reuters) - Brazilian President Michel Temer has agreed to make further changes to a landmark pension reform amid fears that a corruption investigation into dozens of politicians could paralyze Congress, a senior lawmaker said on Thursday.

The draft proposal will likely reduce the number of years of work required to retire with full benefits to 40 from the original amendment of 49 years, said congressman Carlos Marun, who leads the pension reform commission in the lower house.

Another major alteration sets a minimum retirement age of 50 for women and 55 for men, which would gradually increase to reach 65. The change means a softer transition for Brazilians who are closer to retirement age.

The changes could reduce the savings the government expected with the reform to cut some of the world’s most generous pension benefits.

Last week, Temer ceded to other demands to water down the proposal, which aims to limit ballooning pension expenditures that threaten the fiscal health of Latin America’s biggest economy.

The reform is facing stiff resistance in the government-controlled Congress; a newspaper survey last week showed that lawmakers in the lower house would reject the proposal as it stands.

The opening of corruption investigations into dozens of senior politicians and a third of Temer’s cabinet also threatens to slow Temer’s legislative agenda in Congress.

Reporting by Lisandra Paraguassu; Writing by Alonso Soto; Editing by Leslie Adler

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