The president of Paraguay's Social Security Institute (IPS), Isaías Fretes, declared to the Senate on Tuesday that the institution is facing its worst financial crisis in history and stated bluntly: "We want money. I don't know from where, but money." The statement was made during his presentation before Senate committees to discuss the situation of Paraguay's social security system.
Fretes explained that, after three months at the helm of the IPS, his technical team has developed a financial restructuring plan that will allow the institution to maintain its operations until February 2027 without affecting pension funds or taking on new debt. The plan includes renegotiating short-term liabilities for longer terms, freeing up approximately 105 billion guaranis monthly that will be prioritized for purchasing medicines.
The head of the IPS guaranteed that, if projections hold, the institute's shelves will be stocked with medicines within 15 to 22 days. He highlighted that agreements have already been established with the pharmaceutical industry to normalize supply.
However, Fretes warned of the next challenge: a severe human resources crisis expected to hit the IPS in September. "The most urgent issue in September will be Human Resources. Serious, ugly, horrible," he predicted, attributing part of the problem to the reduction in working hours implemented in the health system.
During the Senate hearing, the Minister of Economy, Óscar Lovera, ruled out issuing $300 million in bonds to cover the state's historical debt to the IPS, estimated at over $300 million. Lovera stated that the Executive Branch does not consider this alternative viable at the moment and that it is monitoring the financial restructuring measures proposed by the IPS's current administration.
The Senate Finance Committee rejected two bills that sought to declare an emergency at the IPS and authorize bond issuance. Instead, the proposal to restructure the existing debt gained traction, replacing short-term obligations with long-term financing under strengthened controls.
The National Director of Public Procurement, Agustín Encina, warned that an emergency declaration without adequate controls could open the door for purchases outside the usual oversight mechanisms. Fretes agreed on the need to maintain controls, stating: "I must take care of my image and I need this control mechanism."