A deficit has forced the CCSS to take ¢623.000 million from interest of the pension fund’s portfolio in the last six years. Social contributions are not enough to make the payouts needed to 330,000 retirees.
There are many factors contributing to this ongoing problem. High unemployment, voluntary workers delinquent with the system, and the state as an employer making late payments are some of them.
The Covid-19 pandemic brought about a high unemployment rate of 24.4%. It’s currently at 12%. All of the unemployed are not paying into the health system.
In the 2023 National Budget there was a cut of ¢54,000 million in state contributions to the Fund. The Minister of Finance said the Costa Rican State is going through a complicated fiscal situation that prevents it from complying with its obligations with the retirement system.
Investment earnings are meant to pay future retirees and shouldn’t be touched to make current payments. If the situation worsens, the reserve will have to be used. Decisions and changes must be made as soon as possible.
