On Friday June 14, Gustavo Petro’s “government of change” achieved an important victory in the House of Representatives. With 82 votes in favor and 23 against, Colombia’s “Reform of the Pension System” was approved. This is one of the three key bills that the Executive promised to the citizens, along with the Health System Reform and the Labor Reform (both previously rejected by the Legislative).
On his X account, President Petro celebrated the approval of the emblematic project: “This is the most important social conquest of the working people of Colombia in a long time. […] Millions of workers who have a low salary, [i.e.] the majority [of workers], will have, if they fulfill their age and weeks of contributions, the right to an appropriate pension.”
The pension reform bill proposes, among other things, that people earning up to 2.3 minimum wages (around 3.3 million pesos a month, or about USD 728) must contribute a percentage of their salary to the state institution Colpensiones, which will be responsible for providing retirees with a pension that, according to the government, will allow them to live in decent conditions. Workers earning more than 2.3 minimum wages will be required to contribute a portion of their pension to Colpensiones and the remainder to a private insurance institution of their choice. In this way, Colpensiones will be strengthened in comparison with private insurers.
The retirement age in Colombia is 63 for men and 57 for women. In order to be able to retire, men must contribute for 1,300 weeks, while women must contribute for 1,000 weeks. In addition, for each child, women will be able to reduce their contributions by 50 weeks. This means that a woman with three children will have to contribute 850 weeks in order to retire. The aim is to recognize the time required for childcare in women’s work.
The Pension Reform seeks to provide a better income for retirees living in poverty, who will start receiving a pension, even if they have never contributed to the pension funds. At the same time, it aims to reduce the amount of money the state gives to cover the higher pensions.
However, the Pension Reform will not affect all workers. Men who have contributed for more than 900 weeks and women who have contributed for more than 750 weeks up to July 1 2025, when the reform comes into force, will remain in the current pension system.
In fact, this was one of the major debates surrounding the Pension Reform, as opponents of Petro’s government argue, among other things, that the change would cause a massive influx of contributors, for which Colpensiones is not ready. In this sense, Catherine Juvinao, a member of the House of Representatives, stated that “if [the Pension Reform] goes wrong, in July 2025 we will be facing a logistical, administrative, and financial catastrophe.”
Other neoliberal opponents claim that the rise of the state, specifically the power that Colpensiones will have, will cause greater problems for citizens in accessing their pensions, and expressed concern that the government will be able to manage taxpayers’ money. However, the government has stated that pension money will be handled by the Central Bank, so no government will be able to manage this money as it pleases.
After the approval of the pension reform, the Minister of Labor and former trade union leader of the Colombian Communist Party, Gloria Ramírez, told the press that “after 30 years […] today we are moving on to a structural reform that will allow Colombia (like Switzerland, Denmark, Japan – which already have this [pension] system) to improve and, therefore, give all Colombians dignified protection for their retirement”.
The bill will now have to be reviewed by the Constitutional Court. This could mean the success or failure of the agreements and efforts that the Petro government has made to transform a pension system that currently favors the economic interests of private insurers.
Petro’s government is now trying to use the momentum gained from the approval of the Pension Reform to get the House of Representatives to return to debate the Labor Reform, which was stopped last year. So far, 23 of the 98 articles of the Labor Reform Bill have been approved. However, if the whole law is not approved by June 20 this year, the bill will once again be “frozen”. In this way, Petro’s government seeks to accelerate the discussion of the Labor Reform, while the opposition seeks to delay its approval and thus avoid two consecutive victories of the Executive in less than a month.
