Event Summary
On 5 February 2025, the Paraguayan Chamber of Deputies approved a bill to reform the retirement and pensions system of the public sector, known as the Caja Fiscal. The bill was passed in an extraordinary session during parliamentary recess, following a rushed legislative process without consultation opportunities for civil society or those affected by the changes. Among other changes, it proposed a minimum retirement age and minimum years of contribution. To become law, the bill still needs the approval of the Senate and the promulgation of the Executive Branch.
While the reform is recognized as necessary and urgent in light of the increasing deficit caused by the current retirement and pensions scheme, different sectors of civil society have called out the lack of participation given the importance of the reforms and the impact on workers. In response, a strike among teachers and judicial officials was declared, the police registered increased requests for early retirement, and protests were organized by unions and other civil society actors across different municipalities in Paraguay. The protests drew unusually large crowds and were not only attended by public sector employees directly affected by the law but by a broad segment of the population calling for dignified retirements and denouncing the government’s unwillingness to engage in dialogue.
While the mobilizations led to a postponement of further analysis of the law in the Senate, they also triggered a broader public discussion on social security as a right and a structural issue that deserves a comprehensive and sustainable reform. Actors such as specialists from academia and the ecclesial sector have spoken out proposing an end to privileged treatment of specific sectors of the workforce, professional governance of retirement and pensions funds, and a new social contract, developed through participatory dialogue. They stressed that a universal social protection system needs to be developed that no longer excludes the vast majority of workers, such as those in the informal sector. The coming weeks will show whether the broad mobilization and wider public discourse on the reform of the Fiscal Fund will be taken up and responded to by the government to allow for a more participatory process that takes into account civil society input and engagement.