Economist Manuel Ferreira, former Finance Minister, criticized the proposal to issue bonds to settle the State's historic debt with the Social Security Institute (IPS). The bill under discussion provides for the declaration of an emergency in the institution's sickness and maternity fund and contemplates the issuance of Treasury bonds or the contracting of international loans of up to USD 304 million.
Ferreira questioned the use of perpetual bonds in the IPS's case. According to him, this instrument worked in the past to capitalize Paraguay's Central Bank, but it would not be suitable for social security. "A perpetual bond is essentially a bond with no maturity or with a very long-term maturity — I'm talking about 100 years — and the parties agree on a rate," the economist explained in statements to Rádio Monumental.
As an alternative, the former minister advocated internal measures to resolve the health fund's financial crisis. He cited the case of the company Carlos Casado, which donated 192,000 hectares in the Chaco to settle debts with the IPS. The value of the property was supposed to be divided among the retirement funds (54%), health (39%), and administration (7%), but, according to Ferreira, the funds went entirely to the retirement fund, leaving the health fund without its share.
The economist recommended that the State start paying the IPS immediately to prevent the debt from continuing to grow. "There are many arrangements that can be made internally within the IPS that do not involve third-party debt," he stated. He also criticized the social security system's investment management, which operates on a basic level with short-term certificates of deposit, and suggested professionalizing and diversifying investments into long-term instruments.